Haiti, the situation after the departure of the U.S. contingent from UNMIH

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Haiti, the situation after the departure of the U.S. contingent from UNMIH hearing before the Subcommittee on the Western Hemisphere of the Committee on International Relations, House of Representatives, One Hundred Fourth Congress, second session, February 28, 1996

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HAITI: THE SITUATION AFTER THE DEPAR-
TURE OF THE U.S. CONTINGENT FROM
UNMIH

WEDNESDAY, FEBRUARY 28, 1996
HOUSE OF REPRESENTATIVES,
SUBCOMMITTEE ON THE WESTERN HEMISPHERE,
COMMITTEE ON INTERNATIONAL RELATIONS,
Washington, DC.
The subcommittee met, pursuant to notice, at 1:50 p.m. in room
2172, Rayburn House Office Building, Washington, DC, Hon. Dan
Burton (chairman of the subcommittee) presiding.
Mr. BURTON. The subcommittee will come to order.
I want to apologize to the participants and panelists who are
going to be testifying today. We are working very hard on the Cuba
conference committee bill, and we are negotiating with the Presi-
dent and the Administration, so it makes it difficult for those mem-
bers who would like to be here with us today.
This meeting today is to continue our oversight of U.S. policy in
Haiti. Tomorrow marks the fourth milestone in terms of the U.S.
mission in that country. American troops are scheduled to end
their dominant role in that U.N. Mission in Haiti.
Many of us on both sides of the aisle opposed the original U.S.
intervention, myself included. We are very gratified that U.S.
troops are being withdrawn safely and that we did not witness the
repeat of the Somalia fiasco.
Nevertheless, we continue to be disturbed about key aspects of
the situation in Haiti and about the direction of the U.S. policy.
It will do no one any good to ignore what is truly happening in
Haiti, and we have no intention of doing so. The swearing in of
President Preval earlier this month led to a media rush to declare
success for democracy in Haiti. Like trained parrots, reporters and
commentators repeated over and over again that the inauguration
was an historic turning point for Haiti because it was the first time
in that country's history that a peaceful transfer of power had oc-
curred.
This superficial conclusion and attempt to sweep Haiti under the
rug will simply not do. There are several outstanding questions
that I hope the Administration can answer for us today:
What is the extent of official Haitian involvement in the rash of
political murders we have seen?
To what extent has the Haitian Government covered up its in-
volvement in these murders?

What does the new Haitian Government intend to do about pri-
vatization and economic reform?
Will the new Haitian national police be a truly professional and
non-political force?
Answers to these critical questions will determine in large part
whether or not this Congress will cooperate with the new Haitian
Government.
I believe that President Preval deserves to have the benefit of the
doubt, but we will be watching his performance very carefully in
the critical areas of economic and political reform and respect for
human rights, and we will react accordingly.
At the moment, we must be honest and recognize that the situa-
tion of Haiti is not what we would like for it to be. One of our wit-
nesses today, Dr. Ernest Preeg, a former U.S. ambassador to Haiti,
recently wrote, "Despite more than $2 billion external support, in-
cluding a U.S. military intervention to restore Aristide's Presidency
and a massive economic recovery aid program, Haiti today is less
stable politically and far more destitute economically than it was
when Aristide was elected president. Recognizing this reality is the
first step toward rectifying the situation in Haiti in helping to set
that country on a course to democracy and prosperity."
Let me also state that I received a letter today from Secretary
of State Christopher regarding Ambassador James Dobbins, giving
him a number of pats on the back for his service down there. While
I believe that Ambassador Dobbins has done some positive things,
the fact of the matter is, he lied to this committee and he did it
with knowledge that he was doing so. When we had a hearing to
put his feet in the fire, he pretty much admitted that, and I think
that is unforgivable. I do not believe any ambassador who has come
before the Congress of the United States to talk about something
as serious as the problems in Haiti should be misleading the Con-
gress or even attempting to mislead us.
I also have a letter here from Senator Bob Dole which I want to
put into the record. There are two paragraphs the Senator asked
me to read. These regard the human rights violations in Haiti and
President Clinton's verifying that the human rights problems are
being made to stop.
The last two paragraphs are as follows:
"Mr. President (referring to President Clinton), the time for ex-
cuses is over. Haiti has been occupied by U.S. military forces for
15 months. The Haitian armed forces have been disbanded. Haiti
is not at war. Haiti faces no real external or internal security
threat. American taxpayers have paid billions to support your poli-
cies toward Haiti. Yet your Administration has been mute in con-
demning Haitian Government death squads.
"After all that America has done for Haiti under your policies,
continued Haitian inaction on political killings is unacceptable. It
is time to assure the American people that not one more American
dollar will flow to a government which refuses to investigate politi-
cal murders by its own officials. The American people deserve an
unqualified statement that the Haitian Government's refusal to in-
vestigate government-affiliated death squads will no longer be tol-
erated."
And so I will submit this for the record.

[The prepared statement of Senator Dole appears in the appen-
dix.]
Mr. BURTON. I understand my colleague Congressman Foglietta
is here and would like to make a brief statement.
Would you like to do that at this time, Congressman Foglietta?
Mr. FOGLIETTA. If I may.
Mr. BURTON. If one of you gentleman could just let him in there.
I apologize, but we always show deference to our colleagues, even
if we are of different political philosophies.
Congressman Foglietta.
Mr. FOGLIETTA. Excuse me for a moment, Mr. Chairman. I had
a little problem with my eye, and I have got some special glasses
here.
Mr. BURTON. I hope you get better.
Mr. FOGLIETTA. Thank you, sir.
STATEMENT OF HON. THOMAS M. FOGLIETTA, A REPRESENTA-
TIVE IN CONGRESS FROM THE STATE OF PENNSYLVANIA
Mr. FOGLIETTA. Mr. Chairman and members of the committee, if
they were here, I thank you for allowing me this opportunity to ap-
pear before you today to discuss a subject of great importance to
our nation and the world community: Haiti in its struggle for de-
mocracy, its struggle of its people for freedom and economic
empowerment.
I hope to help you answer the question that faces us today in this
hearing, and that is: "What happens when the U.N. forces leave?"
I for one am optimistic about the future of Haiti. I am optimistic
now, as I was not optimistic before our troops landed.
For the first time in Haiti's 200-year history hope is alive in
Haiti. And hope is a first giant step toward genuine democracy and
real economic progress and empowerment.
I visited Haiti 4 months ago, my fifth or sixth trip in the last 3
years. My first trip in 1993 took place before President Aristide's
return to power; and I saw the horrible scars from the meanest vio-
lence that you could possibly imagine; desperate poverty, children
trying to refresh themselves at the mouth of a sewer. And I saw
the horrible fear that plagued that nation.
But the faces of those Haitian people changed upon one of my
subsequent visits, after Jean Bertrand Aristide returned to power
in 1994. And he did that thanks to the intervention of the United
States.
I saw Haitians cleaning their streets and their neighborhoods. I
saw Haitians rebuilding small businesses and fixing and cleaning
schools and classrooms.
The strides that we have made to restore peace, democracy, and
economic development in Haiti are enormous. Let us compare the
world facing Haitians now as compared to 3 years ago.
I was there in 1993 on a Saturday morning, and I went to visit
the Sacre Coeur Church. The priest came out to greet me and told
me that the Sunday before that, at the 9 a.m. mass, there were be-
tween 500 and 700 people attending holy mass at the Sacre Coeur.
And while the mass was going on, a group of nine or ten govern-
ment hoodlums walked to the second or third aisle, reached into
the pew, took Antoine Izmery, a friend of Aristide's, from his wife

and three children, walked him to the altar, back to the sacristan,
outside the back of the church, around the front of the church, had
him kneel down before a marble statue of Jesus Christ on the
cross, and executed him in front of 300 or 400 people.
That was horrible and that was tragic, but the priest pointed out
to me that what was significant or more significant than even the
murder was the fact that after committing this horrible atrocity the
murderers did not run anywhere; they did not try to leave the
scene of that killing; they brazenly walked back into the church,
back up to the altar, and put a pistol to the head of the priest and
said "You're next."
They did eventually kill him a few months later.
Then they turned around and walked out of that church and
walked down the street laughing.
What was significant, Mr. Chairman, is there was no one to ar-
rest them, no one to apprehend them because they were in cahoots
with the government who were terrorizing the people in this na-
tion.
And as sad as that was, it was just one of between 4,000 and
5,000 brutal murders that had taken place during that military dic-
tatorship following Aristide's overthrow from office by General
Antoine and General Cedras.
Thanks to the actions of President Clinton and the American
men and women in uniform who have served in Haiti, these people,
as many problems as they still have, no longer live in fear. A demo-
cratic government is there. A new rule of law has been established.
A new president has been popularly elected. The army has been
abolished, and a civilian-controlled police force, as difficult as it is
for them, of fine, young Haitian people is being trained.
With the return of Aristide, Haiti's real GDP growth rate grew
to 4.5 percent in 1995, the first positive growth rate in decades.
One year before, in 1994, the GDP was a negative 10.6 percent.
That same year, 80 U.S. companies, including AT&T, Motorola,
Citi-Bank, had the confidence, among hundreds of other companies,
to participate in six U.S. Department of Commerce business devel-
opment missions to the country. And 25 corporations and non-profit
organizations are members of the Commerce U.S.-Haiti Business
Development Council.
Now the transition has not been without problems. I have been
there. There are groups striving for power, and sometimes they are
violent, no question about that; and I certainly do not condone any
of that violence. But these are people who have seen their mothers
raped, they have seen their sisters and brothers killed over the
years. Certainly there are violent people. And when they see some-
one coming back in trying to take power who participated in those
crimes, they do what they should not be doing, and that is killing
people sometimes. It happens.
So I know from first-hand experience that criticisms about our
role in Haiti have been inflated and often fail to accurately take
into account the positive evidence of the progress we have made in
Haiti.
In addition, we witnessed a peaceful and democratic transition of
the government with the election of a new president, Rene Preval.

From this evidence of giant steps toward democracy and eco-
nomic progress, I conclude that our mission in Haiti is a great mili-
tary and diplomatic success story. The challenge in the coming
months and years will be for us to help these people, not to try to
tear them down and go back to the murderous dictatorial regime
of Cedras and Francois but to help them rebuild their country, to
build on the steps we have already taken.
I urge you, Mr. Chairman, and my friends in Congress, and in
the international community, that we take every effort to help Hai-
tians on their path toward peace, democracy, and economic stabil-
ity.
Organizations like the International Monetary Fund, the United
Nations, the U.S. Congress, the World Bank, and others will be
critical to maintaining stability for these wonderful people. And I
welcome their continued participation and leadership in this effort.
What is tomorrow for the people of Haiti? It depends primarily
on us. It is a tomorrow of challenge. It is also a tomorrow of faith
and hope. And that tomorrow has been defined by what we, our
government, and our service people have accomplished there in
Haiti. Let us continue to try to help those people.
Thank you for this opportunity.
Mr. BURTON. Thank you, Congressman.
Mr. FOGLIETTA. I would be happy to answer any questions.
Mr. BURTON. We appreciate your statement, and we are going to
go on to our first panel. But if you stay and you would like to par-
ticipate in the questions and answers, we would be glad to have
you sit with us on the dais.
Mr. FOGLIETTA. Thank you, sir.
Mr. BURTON. We have our esteemed chairman of the Inter-
national Relations Committee.
Mr. GILMAN. Thank you, Chairman Burton. First of all, I want
to commend you for conducting this oversight hearing on the ex-
tremely important situation in Haiti and see where we have been
and where we are going.
I want to commend Congressman Tom Foglietta for his state-
ment and for his taking the time to share his thoughts with us. I
would like to invite, Tom, if you would like to come up and join us
up here.
I want to also thank our distinguished panelists, Ambassador
Leonard, Mr. Christiansen, Colonel Coffin, for joining us today,
also, Ernest Preeg, School Chair, and Peter Johnson, I see you out
there.
I thank all of you for taking the time to bring Congress up to
date on where we have been and where we are going.
Thank you, Mr. Chairman.
Mr. BURTON. Thank you, Chairman Gilman.
We are going to try to confine everybody to the 5-minute rule.
Congressman Gilman and I are going to have to go back to the con-
ference committee on the Cuban issue at 3 p.m., so we need to
make sure we get through the two panels. Please excuse us if we
are a little more abrupt than normal.
We have with us John Christiansen, director of the Haiti Task
Force for the Department of Defense; Army Colonel Richard Coffin,
Western Hemisphere Division for the Joint Staff; and John Leon-

ard, director, Haiti Working Group at the Department of State. We
will start off with Mr. Christiansen.
Mr. CHRISTIANSEN. Mr. Chairman, the State Department rep-
resentative probably ought to go first in order.
Mr. BURTON. Oh, I apologize. Ambassador Leonard, would you
start off?
Mr. LEONARD. That is quite all right.
Mr. BURTON. I am still new at being chairman.
Mr. LEONARD. No, that is quite all right. I do not know whether
I am the senior one of us or whether John is.
Mr. BURTON. Well, you and I have gray hair, so you can go first.
STATEMENT OF AMBASSADOR JOHN P. LEONARD, DIRECTOR,
HAITI WORKING GROUP, DEPARTMENT OF STATE
Mr. LEONARD. Thank you. Since we are limited in time, Mr.
Chairman, what I might do, since copies of my statement are avail-
able, I will try to summarize it very briefly.
Mr. BURTON. Your full statement will be in the record.
Mr. LEONARD. Thank you.
I think it is fair to say that the Administration believes that the
use of our forces in Haiti since September 1994 has met the objec-
tives that we set out at the time.
Those objectives were set by clearly the time of intervention. We
wanted to restore the legitimate democratically elected authorities
to power in Haiti. We wanted to dismantle the instruments of re-
pression in Haiti, specifically the Haitian armed forces and those
groups associated with it which had overthrown constitutional
order. We wanted to assist the Haitians in creating a new profes-
sional and apolitical police force. And we wanted to help them re-
form their judiciary system. And we wanted to create a climate of
security in which those achievements could function and a demo-
cratic process, such as elections, could go forward.
We had a transition in Haiti in March 1995 from the original
U.S.-led force to the present U.N. Mission in Haiti. That went very
smoothly.
Our forces, acting with the utmost professionalism and capabili-
ties, established secure and stable conditions in Haiti.
We began this process of creating a new police force in Haiti,
which is very important to the future of the country. Haiti had
never had a police force before.
So in March we made this transition to the present U.N. force.
We are now facing another transition period. President Preval of
Haiti has said that he would like the U.N. force to stay on in Haiti.
We propose that that be done at a reduced level.
The force that would stay on, assuming Security Council ap-
proval of that, would not have U.S. forces participating in it. John
and Colonel Coffin can describe the withdrawal schedule plans for
our forces from Haiti.
But we do think that the continuation of an international force
there, small though it may be, less than 2,000 people, is important
given the relative inexperience of the new Haitian police force and
the fragility of the country's institutions.

And so we support the idea of a limited extension of that force,
as I say, at reduced levels. That is now under active consideration
in New York.
As for the road ahead, we know that there are, indeed, many
problems which Haiti faces; and we certainly do not underesti-
mate-we believe that it is essential that the new Haitian Govern-
ment create a climate which is capable of attracting investment,
that it undertake sound economic policies, that it get the private
sector growing and moving; because, quite frankly, that is the only
way in the long run that jobs can be created.
We also believe that it is essential that they have, as I said, an
apolitical, professional police force. We will continue to assist Haiti
in that. We think that we have made a good start in helping the
Haitians to begin to overcome the legacy of political violence which
is the unfortunate history of that country.
But ultimately in the long-run, the Haitians are going to have to
assume responsibility for guiding their own destiny. We can and
should, together with others in the international community, con-
tinue to assist Haiti. It is important. It is a close neighbor of ours.
And events in Haiti do have a way of impacting on our own situa-
tion.
But ultimately Haiti's people are going to be the ones who have
to make the changes necessary. What we really have given Haiti,
we think, is an opportunity to turn a corner. We see a lot of prob-
lems ahead on the economic side, as I mentioned. There is a lot
more work to be done in Haiti on making sure their police forces
are adequate to the job, that their democratic institutions are
strengthened.
But, as I say, we think a real opportunity has been given to the
Haitian people.
Finally, as our forces are in the process of withdrawing, I cer-
tainly for one would like to be among those who salute them for
the job that they have done. I myself served in the Army for 3
years, and I have the greatest respect for our armed forces and
their ability to carry out a mission such as that. They have done
magnificently.
And I might add that our people in our embassy have also done
absolutely outstanding work. They will continue to be there. They
will continue to work to be engaged in Haiti as we believe is impor-
tant in the long run.
Mr. BURTON. Thank you, Ambassador Leonard.
[The prepared statement of Ambassador Leonard appears in the
appendix.]
Mr. BURTON. Mr. Christiansen.
STATEMENT OF JOHN CHRISTIANSEN, DIRECTOR, HAITI TASK
FORCE, DEPARTMENT OF DEFENSE
Mr. CHRISTIANSEN. Thank you, Mr. Chairman.
A great deal has transpired since U.S. military forces entered
Haiti on September 19, 1994. You will recall that Operation UP-
HOLD DEMOCRACY was conducted against a repressive military
regime which had, since 1991, defied both the U.S. and inter-
national demands to restore the constitutionally elected govern-
ment.

After diplomatic efforts failed to dislodge the de facto regime, the
U.S. military prepared to use military force as a part of a multi-
national force known as the MNF. This was authorized by U.N. Se-
curity Council Resolution 940 in 1994, which called for the use of
all necessary means to secure the departure of the coup leaders; to
restore the legitimate government to Haiti; to create a secure and
stable environment that would allow the people of Haiti to rebuild
their country.
On the eve of the intervention, September 18, 1994, an agree-
ment was reached with Haiti's de facto leadership that would facili-
tate the departure of the coup leaders and allow the return of the
elected government.
Within hours the U.S. invasion force, which had been thought
necessary, was able to reorient and redeploy to enter Haiti peace-
fully in order to carry out the provisions of U.N. Resolution 940.
The U.S.-led multinational force peacefully entered Haiti the
next day and quickly achieved its initial objectives. The Haitian
military leadership departed by October 13, and President Aristide
returned to Haiti on October 15th.
Inherent in the U.S. forces' mission was the protection of U.S.
citizens and U.S. facilities. The MNF operation was conducted
through March 31, 1995, during which an excess of 20,000 Amer-
ican service men and women from the U.S. Army, Navy, Air Force,
Marine Corps, and Coast Guard served in conjunction with ap-
proximately 5,000 non-U.S. forces and civilian police personnel
from 31 nations.
In the months that followed, the U.S. and coalition presence ex-
panded throughout Haiti, providing a secure environment. Aggres-
sive weapons control and reduction measures were instituted which
led to the seizure of weapons posing a threat to the MNF and re-
ducing the number of illegal weapons in Haiti.
Essential public services, such as electrical power, were restored
to key areas. Direct assistance to the Haitian Government min-
istries by the U.S. military civil affairs specialists was vital to help-
ing them reestablish functional governance.
Under the secure conditions provided by our military operations,
a major international and interagency effort began to build a com-
pletely new professional police force for Haiti.
The exit strategy for ending our MNF deployment was the tran-
sition of UNMIH. On January 30, 1995, the U.N. Security Council
passed Resolution 975 recognizing that a secure and stable envi-
ronment existed in Haiti and authorizing the termination of the
MNF mission and the deployment of UNMIH. On March 31, 1995,
this handoff occurred without incident.
At its peak, UNMIH, approximately 6,000 military and about
900 civilian police officers, was able to sustain and maintain the se-
cure and stable environment.
In addition to providing the Force Commander, Major General
Joseph Kinzer, U.S. Army, approximately 2,400 men and women of
the U.S. Armed Forces comprised the backbone of UNMIH with
combat and support services such as infantry, special operations
forces, headquarters staff, aviation, medical, and military police.
Like the MNF before it, UNMIH's military component expanded
its presence throughout Haiti. Of note was UNMIH's significant

contributions toward enabling free legislative and Presidential elec-
tions. This led to Haiti's first-ever transfer of power from President
Aristide to Rene Preval on February 7, 1996.
These many accomplishments of Haiti, under both the MNF and
UNMIH, are due, in large part, to the professionalism and dedica-
tion of our armed forces. The U.S. military has performed superbly:
acting decisively, responsibly, and humanely in carrying out a dif-
ficult and complex mission.
Though U.S. forces led this mission, great appreciation must go
to all nations whose contributions to the MNF and UNMIH have
made our efforts in Haiti a success.
Much remains to be done in Haiti, but the military role has
markedly diminished. We see at this time no organized threat to
the Haitian Government or the international presence. However, it
is possible that opponents of democratic rule in Haiti may become
emboldened by the reduced international presence.
The Government of Haiti has fielded a police force of over 5,000
with training and other assistance provided by the U.S. Depart-
ment of Justice and other international contributors.
As noted by the Secretary General in his most recent report on
Haiti, observers are nearly unanimous in their assessment that
Haiti's new police force needs the support of UNMIH for a while
longer in view of the potential threats to the government, the prob-
lem of common crime, and the inexperience of the Haitian national
police.
The UNMIH mandate is set to expire on February 29, 1996.
President Preval has requested extension of the UNMIH mandate,
and the U.N. Security Council is considering the resolution which
would extend this for several months.
My colleague from the Joint Staff Operations Division, Colonel
Rick Coffin, is prepared to provide you with a short briefing on our
withdraw plans. So I will not address that aspect of the DoD's in-
volvement.
However, I think it important to note that after a small U.S.
military transitional element for logistical support withdraws on or
by April 15, there will be no U.S. military participation in the fol-
low-on U.N. mission.
DoD will continue its engagement in Haiti on a normal, bilateral
basis, through participation in activities such as Exercise
FAIRWINDS, with the primary purpose of training U.S. forces.
These deployments include both engineering and medical. Engi-
neering projects include water wells, school/hospital renovations,
and are similar to those done throughout the hemisphere.
Mr. Chairman, I see that my time has expired; and if I could
offer to you the briefing by Colonel Coffin.
[The prepared statement of Mr. Christiansen appears in the ap-
pendix.]
Mr. BURTON. If you do not mind, we will put the rest of your
statement in the record; and we will review that.
And we are interested in Colonel Coffin's statement.
Mr. CHRISTIANSEN. Thank you.
Mr. BURTON. Colonel Coffin.

STATEMENT OF ARMY COLONEL RICHARD H. COFFIN,
WESTERN HEMISPHERE DIVISION, J-3, JOINT STAFF
Colonel COFFIN. Mr. Chairman, I have been asked not to provide
a statement, but in your packet you will find a short six-slide brief-
ing entitled "U.S. Military Presence in Haiti, UNMIH Drawdown."
And I will just briefly review the U.N. Drawdown Plan and the
support the United States will provide after the UNMIH mandate
is over.
Today we have slightly over 1700 U.S. personnel in Haiti. The
mandate ends tomorrow, as we indicated. We will begin redeploy-
ing the U.S. security forces on Friday. Eighty-five persons of that
1700-man force represents a security force, and they will subse-
quently be out of Haiti by the 14th of March.
We will leave approximately 300 support personnel under U.N.
control between the 15th of March and the 15th of April. They will
continue to provide additional support to the remaining U.N. ele-
ments. And they, too, will redeploy by the 15th of April.
As indicated by Mr. Christiansen, the United Nations is consider-
ing a mandate extension; however, there are no U.S. forces to be
included beyond the current mandate.
The third slide, basically, is a graph which shows the Drawdown
Plan, the upper line being the U.N. Drawdown Plan, the lower line
being the U.S. Drawdown Plan, which I will talk about in a little
more detail in a moment.
The United Nations began their drawdown on the 1st of Decem-
ber, and approximately half of the forces have been redeployed by
this time. Essentially they uncovered the outlying area initially.
They are now in smaller contingents, primarily military police and
infantry, as the Haitian national police stood up and took respon-
sibility for the security mission.
Essentially the United States, Pakistan, Bangladesh, and Can-
ada are the contingents that remain today. And the switch of con-
trol will transfer from the U.S. contingent commander to the Ban-
gladesh contingent commander tomorrow.
The bulk of the forces that are in Haiti today are now con-
centrated mostly in the area of Port-au-Prince.
The U.S. drawdown on the next page essentially outlines how we
are taking U.S. forces out. The Special Forces, eight teams that
were deployed in the countryside, began redeploying on the 4th of
January. Their redeployment is complete, and they are now back
in the continental United States.
The only special forces are the special operations forces whose
presence remains now are those individuals who continue to pro-
vide support for the force as a whole.
In the upper right of the slide is a box which essentially outlines
the U.S. support forces that will remain in place after the 15th of
March. They primarily are a small medical unit that provides basi-
cally triage care for anyone injured; additional logistics elements
that have some small boats, small crafts, to participate in the re-
supply effort. We have four helicopters which will remain to sup-
port the movement of the redeploying forces out of Cape Hatien
back into Port-au-Prince. There is an engineer unit primarily con-
cerned with taking down camps, and they will not necessarily re-

main until the 15th of April. They will simply redeploy when that
mission is complete.
We have some members of the U.N. staff and the military infor-
mation support team that I indicated for an upper limit of about
327 people, which will drop to about 227 when the engineers rede-
ploy.
So that is essentially the residual component of our forces.
The next slide captioned "Mission Successes," shows how the
military mission has remained successful; and we have created in
Haiti the environment in which the democratic, legislative, and
elected reforms have taken place. We have also assisted in the res-
toration of infrastructure in Haiti.
The last slide summarizes our continued bilateral deployments in
Haiti in terms of FAIRWINDS. And these are essentially the same
sorts of deployments and training that we do around the world.
Two conditions must be met. One is it has to be at the initiation
of the host government, and it must be a non-hostile environment.
We will continue to rotate engineer and medical units through
Haiti to do humanitarian and civil affairs projects such as those
listed: water wells, water distribution systems, school/hospital im-
provements. And that program right now is scheduled to terminate
in 1997.
That briefly summarizes the Drawdown Plan and our continued
involvement outside the U.N. Drawdown.
Mr. BURTON. Thank you very much, Colonel.
Mr. BURTON. I will yield to my colleague, the Chairman of the
committee, because he is the boss and he has to leave.
Mr. Chairman.
Mr. GILMAN. Thank you, Mr. Chairman.
How do you envision Haiti emerging from its current economic
crisis?
Mr. LEONARD. Well, I think, Mr. Chairman, the key really is for
this new government to go back to the kinds of economic policies
that President Aristide's government laid out a little over a year
ago at a conference in Paris in January 1995.
His government laid out an excellent plan which involved a cre-
ation of an environment which would stimulate investment, reduce
government spending, privatize state corporations-
Mr. GILMAN. Is Mr. Preval going along with that? Is he commit-
ted to that?
Mr. LEONARD. In our talks with him, we have emphasized to him
the importance of adopting that kind of a program.
Mr. GILMAN. Is he willing to adopt it?
Mr. LEONARD. I think it is too early to say, Mr. Chairman, yet
what kind of a policy he will adopt.
We are going to be looking, for example, at the kind of people he
appoints to key ministries-Minister of Finance, for example-and
the statements that he makes when he presents his cabinet and his
government policy to the-
Mr. GILMAN. Is Preval committed to privatization?
Mr. LEONARD. Again, I think I would have to reserve judgment
on that. He said that he understands the importance of it. But, on
the other hand, the previous government said the same thing and
was not able to continue and go forward.

So I think we would want to-while urging the importance of
those measures, I cannot predict at this point how quickly the gov-
ernment is going to be taking them on.
They are crucial.
Mr. GILMAN. Mr. Christiansen, do you want to comment on that?
Mr. CHRISTIANSEN. Yes, sir. From the Department of Defense's
perspective, the U.S. military and the international forces have ba-
sically helped to free the Haitian people from the yoke of an op-
pressive government system.
Mr. GILMAN. Could you move closer to the microphone?
Mr. CHRISTIANSEN. The U.S. military forces and the international
forces which have participated in the mission of Haiti have served
to help free the Haitian people from the yoke of an oppressive gov-
ernment.
We believe that we have provided them, we think, with an oppor-
tune environment from which they can now launch significant eco-
nomic reforms.
Mr. GILMAN. We are talking about specific plans. Are there plans
to do that? Is the administration in Haiti now committed to that?
Mr. CHRISTIANSEN. I believe that the administration is commit-
ted to assisting the Government of Haiti, yes.
Mr. GILMAN. I am talking about the Haitian administration.
Mr. CHRISTIANSEN. I believe that the Haitian Government is
committed to this, yes.
Mr. GILMAN. Colonel Coffin.
Colonel COFFIN. I have no comment to offer.
Mr. GILMAN. Thank you, Mr. Chairman. I regret that I have to
leave.
Mr. BURTON. Mr. Chairman, I will see you at the conference com-
mittee in a half hour.
Let me start off by saying, there are going to be approximately
327 U.S. troops left behind in Haiti, and it is our understanding
that within a year we will have all of our troops out. I think we
may be splitting hairs there.
There are going to be (according to the figures you have cited),
about 1900 combining forces left behind from various sources, Ca-
nadian and others; and there are going to be costs incurred. The
United Nations is scheduled to vote on this extension today; and
because of Cuba and other issues, that has been put off until to-
morrow.
Do you have any information, any of you, on how much it is
going to cost and who is going to bear the cost of this?
So far we have spent about $2 billion more in Haiti in this oper-
ation; and now we are going to extend this and we are going to
have 1900 troops there. We pay about 37 percent of the U.N.'s ex-
penses there.
I would just like to know how much cost is going to be borne by
the United Nations and what it is going to cost and how much the
United States is going to have to participate?
Mr. LEONARD. Mr. Chairman, I will defer to correction from my
colleagues, but I believe that the estimate that the United Nations
made for a 1900-person force for 6 months was on the order of $50
million.

13

Mr. CHRISTIANSEN. About $56.1 million is what we believe the
estimate to be.
Mr. LEONARD. Thank you.
Mr. BURTON. Ambassador Leonard, pardon me for interrupting.
But are we anticipating going beyond the 6 months for these forces
there? If we are going to go beyond 6 months, then how long are
we going to be there and what is the estimated cost for the total
operation?
Mr. LEONARD. The resolution that is before the Council right now
provides for an additional 6 months as the final extension of this
mandate of the UNMIH force.
Now, as you say, Mr. Chairman, it is before the Council. The vote
has been-I have just recently been told, as you said-put off until
tomorrow. So we are coming down to the wire on this, and we just
do not know at this point, cannot say exactly, when or how we will
get approval for this force.
I think ultimately that we will. But it has gone down to the wire,
as you said.
Mr. BURTON. OK.
Colonel COFFIN. Sir, if I could clarify for a moment. The 300 U.S.
personnel who remain behind in support of the United Nations, if
the mandate were not extended tomorrow, they would still remain
in place and continue to support the drawdown because they are
providing support for the force as a whole.
The condition for their redeployment are that they will redeploy
when their mission is complete, as I indicated with the engineers;
when they are replaced in kind by another force; or the 15th of
April, whichever comes first.
And so I believe that their continued involvement, at least up to
15 April, is covered under the costs of the original U.N. mandate
because the United Nations, even though the mandate termi-
nates-phases forces out over about a 50- to 60-day period after the
end of the mandate.
So the cost of them being there in Haiti and operating as oc-
curred is covered under the current mandate.
Mr. CHRISTIANSEN. And, Mr. Chairman, this is strictly a transi-
tional element. It will expire.
Mr. BURTON. I understand.
Mr. LEONARD. If I could just add one other thing, Mr. Chairman.
At this point, we do not know-because the situation is very fluid
in New York-exactly how we are going to be able to achieve this
extension of the UNMIH mandate. There is negotiation that has
been going on up there for several days.
Mr. BURTON. We will talk to Madeleine Albright and keep an eye
on that.
Mr. LEONARD. Yes, sir.
Mr. BURTON. Let me ask another question of our panel before I
ask if there are any other questions from our colleagues.
And to my colleague from Florida back there, Mr.-what is your
name-we would love to have you come up here and ask questions
if you would like.
I would like to know about the political murders that have taken
place. There have been plenty of political murders in the past year,

year and a half, including Mireille Durocher-Bertin who was shot
in downtown Port-au-Prince in a busy intersection.
Our intelligence and our State Department told us, after the inci-
dent that she was not warned, and yet our FBI and our military
knew about it; and they went to the Aristide Government and told
them that there was a possible assassination attempt going to take
place on this woman's life. And so she was warned, but had no pro-
tection. She was shot to death in downtown Port-au-Prince.
Thirteen people were under investigation. And the FBI went to
Haiti and did some investigating. So far no resolution of that trag-
edy has taken place. We have not had the best cooperation from
the Aristide Government nor from its successor. The Haitian Gov-
ernment was providing legal defense people because most of the
suspects were members of the government, these very people who
were believed to have been involved in this assassination.
Now that is very disconcerting, because we are propping up a re-
gime in Haiti and now we are going to spend $56 million more to
keep the troops there to prevent chaos from occurring.
My question is: What has happened? Do we have any additional
information on this murder? Are government officials that are still
in the government involved? Or were they involved? And if we do
not have any information on it, why not?
Mr. LEONARD. Mr. Chairman, maybe I could talk first to the mat-
ter of the warning to Ms. Bertin.
Our armed forces in Haiti at the time did get information about
a possible plot against her. The people who we were told were in-
volved in that plot were taken into custody.
There was discussion about warning Ms. Bertin and how to do
that. The decision was made that the Haitian Minister of Justice
would do so. We asked him to do so. We briefed him on it.
Mr. BURTON. He is one of the suspects, was he not?
Mr. LEONARD. No, sir. I do not believe so. I am not aware that
he was ever in any way implicated in that.
Mr. BURTON. Do you know how many people in the government
are under investigation for the murder of Ms. Bertin?
Mr. LEONARD. I do not recall the exact number, but I know that
a number of people in the government or people who served in se-
curity forces, we have had information of possible implication in
that crime and some others.
Mr. BURTON. Has the thought occurred that the possibility of her
being assassinated was never told to her, as her family believes?
Mr. LEONARD. Well, I know the Minister of Justice assured us
that he had done so. Ms. Bertin's family says that she did not re-
ceive a specific warning of that threat.
I am not in a position-and I do not know whether anybody is--
to know for certain which way it was. The former Justice Minister,
for whom we do have considerable respect and with whom we did
work closely, assured us that he did. But I cannot tell you for cer-
tain whether it happened. As a result-
Mr. BURTON. Let me interrupt you.
Mr. LEONARD. Yes, sir.
Mr. BURTON. It seems to me inconceivable if somebody said there
was going to be an attempt on your life, you would not have protec-
tion to take caution.

She was in downtown Port-au-Prince, on a busy street, in a traf-
fic jam when they hit her. I cannot conceive of anybody who has
been warned that they might be killed going into that kind of situ-
ation without some kind of protection.
And so for the Minister of Justice whom you think is a good man,
to say that he warned her and her family almost stretches the
imagination. Because had he done so, as he claimed, I cannot be-
lieve she would put herself in that position.
So can you give me any kind of indication of additional steps that
have been taken to try to come to a conclusion on this matter?
Mr. LEONARD. Well, let me just say that we have brought to the
attention both of President Preval and his predecessor, President
Aristide, that we cannot continue to support police and security
forces which have in their ranks individuals whom we have a rea-
sonable basis to believe may be involved in political killings. And
we made that very clear to both of them. We called for them to
take appropriate action against any such individuals, and we are
obviously very hopeful that such action will be forthcoming.
There will be a new government in power very shortly, a new
cabinet with a new prime minister in Haiti; and we are hopeful
that we will see some action on that.
Mr. BURTON. Well, as I yield to Mr. Foglietta, let me just say
that I hope you will convey this to President Preval: I hope-and
I think the Congress hopes-that any rogue elements in the police
force or in that government who participate in political assassina-
tion should be ferreted out posthaste, because I think it has a lot
to do with whether or not there is going to be continued support.
The patience of this Congress is stretched to the limit right now.
Mr. Foglietta.
Mr. FOGLIETTA. I thank the Chairman. I agree wholeheartedly
with your last statement, that they must ferreted out. If there is
any person involved in political killings or any kind of killing, I
agree with you that they must be ferreted out.
And I would suggest very strongly-and I will suggest very
strongly to President Preval when I meet with him-that justice be
imposed.
Let me just clear the record also. The Ambassador did not state
that he believed that the Justice Minister was or did, in fact, in-
form Ms. Bertin. Rather he said he did, and her family said he did
not. So, therefore, we do not know who was telling the truth.
Mr. LEONARD. I do not know.
Mr. FOGLIETTA. Also, just to put some of these numbers into per-
spective, we are talking about $56 million more over a 6-month ex-
tension to try to bring stability and peace and democracy to a na-
tion of 6 million people. And we all know that, especially those of
us who have served on the Armed Services Committee, that $56
million is the cost of around 10 percent of one B-2 Bomber.
So we need to put that in perspective as to what we are doing
with our money here in the Congress of the United States.
Second, we talk about 20 murders in a period of one and a half
years. Horrible. Horrible to have one murder. The fact is that there
ave been five times that many murders in my congressional dis-
trict in the last year and a half.
Again, I am just trying to put things in perspective.

Going back to the original proposition, talking about privatiza-
tion, I have urged as strongly as I could President Aristide and
President Preval personally to move as speedily as they could on
privatization.
But is it not true, Ambassador Leonard, that immediate privat-
ization would precipitate a serious decline in employment imme-
diately; although, in the long run, it probably would increase em-
ployment, the fact is, the move to privatization suddenly would
cause an increase in unemployment?
Mr. LEONARD. There are some steps though, sir, which could be
taken quite quickly I think. For example, privatizing a couple of
state corporations which are not now currently operating and
which, therefore, are not contributing to employment.
Bids have been, for example, made on I think it is a flour mill
and one or two other state enterprises; and that would be a very
good first step to proceed with that.
Your point is well taken, though, that broader privatization of
state enterprises that are operating is extremely controversial in
Haiti. There is great concern over the impact that might have on
employment.
At the same time, it is a step which is going to have to be taken
sooner or later.
Mr. FOGLIETTA. I thank you very much, and I urge the chairman
of the committee to see what we can do in Haiti to try to bring
peace and stability.
Mr. BURTON. I thank the gentleman for his participation.
Let me just say before I yield to my good friend Mr. Goss from
Florida, one of the things we are negotiating today is an additional
sanctions agreement on Cuba. I think everybody is aware of what
has happened in the last few days by the Castro regime.
And we understand that before Aristide handed over power, he
recognized Cuba and he did business with Cuba. I hope that in the
course of questioning that you will make some comment about that.
The other thing I would like for you to do is to make the point
that it was agreed when we went in to Haiti that there would be
a move to privatize and involve the free enterprise system in this
government. The government in Haiti has so far restricted that,
and I hope the new president will move toward privatization.
With that, I am happy to yield to my colleague from Florida, Mr.
Goss.
Mr. Goss. Thank you very much, Mr. Chairman.
It is a pleasure see you, Ambassador Leonard, again.
Mr. LEONARD. Thank you.
Mr. Goss. I apologize for coming in late. This is an area that is
close to my district.
Mr. BURTON. Would the gentleman yield?
Mr. Goss. Yes, of course.
Mr. BURTON. I would like to ask for unanimous consent to have
the gentleman from Florida, Mr. Goss, take the chair because I
need to go to the conference committee.
Without objection.
Thank you, gentlemen.
Mr. LEONARD. Thank you, Mr. Chairman.
Mr. BURTON. I will read very carefully whatever he says.

Mr. Goss. [Presiding.] Thank you, Mr. Chairman.
I will follow up with a statement about Cuba. It is an area of
concern to me as well.
We are interested, obviously, in Haiti and civil law and order.
And that is in every sense of the word. It is not just about their
economy or its politics. It is all of those topics we keep reading
about in the papers.
One of the questions that obviously affects civil law and order is
the degree to which former President Aristide is going to continue
to exert influence on the Preval Government. And what are his ac-
tions going to be? What type of directions will he be able to give
to President Preval? Does Aristide have influence on President
Preval? To what degree? And what type of influence would that be?
It is in that area that I think the question about Cuba becomes
relevant. I think that there is no dodging the fact that the gesture
that former President Aristide made by his last-second recognition
of Cuba was a very clear signal. But it does open the door for col-
laboration with Cuba and Haiti. It has the practical impact of
doing that. And of Haiti possibly getting some help of some type,
although it is hard to imagine one basket case helping out another
basket case. Nevertheless, two basket cases make more trouble
than one.
So I think it is a fair question to ask: What is the relationship
going to be with regard to President Preval and an association with
astro?
And then I want your comments on civil law and order and the
possibility of mischief either in Haiti or elsewhere and whether
there will be mischief that will be contrary to American interests.
And then the other area that comes into this is the question-
and this is one that attempts to get on the evening news-of the
economy being so bad. And one of the things we would hope for at
this point is a greater incentive for investment to help shore up the
economy there and to begin to the process of having Haiti help it-
self. The Government of Haiti's direction in that area has been
woefully unsuccessful, if in fact it has been serious at all about
doing anything.
I would suggest that the U.S. taxpayers have been extraor-
dinarily generous to the nation of Haiti in the past 2 years, to the
tune of something in excess of over $3 billion. Of course, that is not
all Haiti. That is the total commitment. And I suspect that number
is even more than $3 billion when you add it all up.
So having made that sort of preamble to my general questions
of this panel, going back to the civility question, the economy ques-
tion, and then this question of the independence of Preval from
former President Aristide and throwing the Cuba card into the mix
now, I would be curious if you have any views about what the jus-
tification would be for spending more U.S. taxpayers' dollars and
what prospects there are for peace and prosperity in Haiti.
Mr. LEONARD. Let me start with relations between President
Preval and former President Aristide. They have had a very close
relationship for many years. During the Presidential campaign, Mr.
Preval referred to himself as Aristide's twin. They have worked to-
gether closely for many years, and I think that is likely to continue.

You know, there has been a lot of speculation about President
Preval being overshadowed by President Aristide or somehow not
getting out from under his shadow.
I think that President Preval is going to come out, he will stand
on his own, I think that, inevitably as president, we are going to
see that.
President Aristide is obviously going to continue to play a very
important role in that country's politics. We will certainly continue
to be talking with him and dealing with him. He is a very impor-
tant political figure in the country. And he has given every indica-
tion that he thinks it is important that he continue to try and urge
reconciliation on the Haitian people and that he will play a respon-
sible role in trying to help them consolidate democratic practices
there.
As for relations with Cuba, clearly that is not something that we
welcome. On the contrary, it is something that we would have dis-
couraged had we been consulted about it. And we are certainly
aware to the possibility of Cuban mischief in Haiti. And that is
something, obviously, we have to keep an eye on and watch.
You mentioned that Cuba is a basket case, and that is certainly
the case in terms of their economy. But, nonetheless, the Cubans
have shown a history of causing trouble elsewhere; and that is
something that we are going to want to keep an eye on.
On the broader question of the economy, I would go back to what
I said a little earlier. President Aristide s Government began with
an excellent economic platform and program. And it came to an
election year, at a Presidential election campaign, and the adher-
ence to that program faltered. That is something that is not un-
known in many countries.
What is now needed is to get back to that kind of program, a pro-
gram which is based on encouraging growth in the private sector,
cutting back the role of the government in the private sector espe-
cially by moving to privatization, exercising fiscal discipline, very
strict fiscal discipline, and doing the things that are necessary to
encourage private investment, both from Haitian businessmen and
from foreigners.
A very important first step on that will be to resume negotiations
with the Bretton Woods Institutions on some agreements that are
outstanding that would provide Haiti with some very badly needed
additional help. And that is clearly going to be an incentive to the
new government to move quickly on that.
Over the longer term, I think that the prospects for Haiti, as dif-
ficult as their situation is now, are not entirely bleak. As I say, I
believe that what the international community has done is to give-
Haiti the opportunity to turn a corner. We have given them an op-
portunity to achieve a strong measure of political stability; we have
given them some breathing space in which to undertake necessary
economic reforms.
Realistically, these things are going to take some additional time.
But we believe that it is very much in our interest and in the inter-
est of the international community to continue to provide support
to Haiti to keep it moving along the hopeful direction in which they
are now going.

19
Mr. Goss. Would you be willing to comment on the outlook for
civic law and order, as well? Who is the chief of police? Who is the
new chief of police? How does that work?
Mr. LEONARD. Yes. Mr. Preval has indicated his intention to
nominate a gentleman to be the new director general of the police.
His name is Mr. Pierre Denize.
He is presently the head of a non-governmental organization in
Haiti which has ben very active in drug abuse prevention. And his
name I believe either is or is going to be very shortly before the
Haitian parliament for confirmation.
On the broader question of law and order, we understand that
this is essential-that effective police and justice system is essen-
tial to political stability in Haiti, which in turn is essential to Haiti
being able to turn that corner I talk about.
That is why one of the very first things we did upon going into
Haiti was to begin plans and preparations to create a whole new
police force that Haiti will have-that it does have now for the first
time in its history.
We were quite insistent that this had to be an politically se-
lected, professional force because only in that way could Haiti begin
to get good law enforcement.
That force now numbers approximately 5,000 people. The biggest
problems it has right now are, No. 1, lack of experience; and, No.
2, a lack of experienced supervisors. Right now there is a very seri-
ous shortage of supervisors.
And, quite frankly, in Haiti it is a problem. There are very, very
few people who have any experience at police work. There are some
people in the armed forces--or the former armed forces; but one
does have to exercise some caution there because they are obvi-
ously associated with many of the abuses of the past.
So staffing the Haitian national police with effective supervisors
is going to be one of the critical tasks facing the new government.
And we are working with them very closely to try and help them
to do that.
Mr. Goss. Thank you.
Mr. Christiansen or Colonel Coffin, do you have any comments
on the questions I asked?
Mr. CHRISTIANSEN. Sir, I have nothing to add on the economic
front above and beyond what the Ambassador has noted.
I do agree with Ambassador Leonard, I think the police force is
a relative green force, a new force.
Mr. Goss. Colonel Coffin.
Colonel COFFIN. No, sir.
Mr. LEONARD. If I could just mention one other thing. One of my
colleagues passed me a little note that I did not want to allow
unpassed about-I guess going back to the business of the cost of
the extended UNMIH presence in Haiti. We mentioned a figure of
$56 million.
I should point out that that would be the overall cost of which
we would pay one-quarter, 25 percent.
So I just wanted to get that on the record.
Mr. Goss. Mr. Foglietta.
Mr. FOGLIETTA. Yes. Is not one of the problems faced by the new
police force is that they are, not only relatively new, but that they

are out-gunned by many of the soldiers of the former regime that
are still around and by the crooks that are still around? And have
they also overreacted in certain situations?
Mr. LEONARD. There have been, yes, sir, cases when we believe
that the new police have overreacted, sometimes because they be-
lieve they, perhaps, were outgunned in certain situations.
On the matter of armaments, our forces in Haiti did collect a
very large number of weapons, both from the old Haitian Army and
in a weapons buy-back program that we undertook.
There are too many guns in Haiti, yes. Some of them are prob-
ably in the wrong hands. I think it is more, rather than the old op-
ponents of the regime, the greater problem is one of gangsters,
common criminals.
But, yes, having too many weapons in that country I think prob-
ably is a problem. And I know that the Haitian police do feel that
they tend to be out-gunned.
On the other hand, because they are new, because they are some-
what green, I think one has to be careful in giving them too much
firepower because they do not have the experience.
Mr. FOGLIETTA. Is not the government of Haiti now provided
with crowd control programs and equipment?
Mr. LEONARD. Yes, sir. One class has already graduated from the
police academy which went through a crowd control course. There
is another one which I believe is scheduled for the future.
The class which graduated has remained together as a kind of
a small unit. So they have the beginnings of that capability, yes,
sir.
Mr. FOGLIETTA. Also, is it not true that the U.S. intelligence has
supplied the Haitian Government with the information we have
vis-a-vis various murders that might be perpetrated? Would they
not be prepared to deal with that given the information we supply
them?
Mr. LEONARD. I do not know whether I am really qualified to
talk about the nature of our intelligence collection or relationships
with the Haitian Government. I think I would rather defer on that
question. And if I could, I will get back to you.
[Mr. Leonard's response: It is our policy to ensure that individuals are warned
when plausible information is received of a specific threat against them. Since the
March 28, 1995, killing of Mireille Durocher Bertin, we have made it a policy to en-
sure that the warning is made directly by a U.S. official to the person allegedly
threatened. Such warnings have been delivered to a handful of individuals in Haiti
since the U.S.-led intervention. Procedures are also in place to share threat informa-
tion with both the Haitian Government and the U.N. Mission in Haiti. In the case
of the former, we have sought to ensure that the Haitian Government has a clear
understanding as to its responsibility for maintaining public order and security in
Haiti. To that end we are currently working with the new leadership of the Haitian
National Police to establish standards for investigating threats and deterring at-
tacks.]
I think it is fair to say, though, that we do share with the Hai-
tian authorities, information that we get about potential threats to
the government should they arise. And I am not aware that that
has been a major problem.
Mr. FOGLIETTA. One other thing. You talked earlier about var-
ious industries and businesses and things that could be privatized
immediately. Could you supply me with a list of them?

Mr. LEONARD. Yes, sir. These cases are cases in which bids al-
ready have been submitted but have not been opened. And in, I be-
lieve, at least one or two cases these are enterprises which have
not been operating for several years. But I will get you a list. The
two mentioned most often are the state-owned flour mill and ce-
ment factory.
Mr. FOGLIETTA. Thank you.
Mr. LEONARD. Yes, sir.
Mr. Goss. Thank you.
We will excuse the panel in a moment. I have three specific ques-
tions left over from other members and the staff which I would like
to address with the panel before going to the next panel.
Just following Mr. Foglietta's question, I certainly agree that
there has been a problem with too many guns in Haiti and some
in the wrong hands.
But I cannot help but notice that many of the casualties in terms
of law and order right now have been in crowds, innocent bystand-
ers. Certainly the young lady, school girl who was standing and
waiting for the school bus was not carrying a weapon when she
was shot. And the reaction from the police force has been some-
what unprofessional. And I think your answer about lack of leader-
ship and lack of experience clearly is something we are concerned
about.
I have three specific questions. The first has to do with data com-
ing into us about the impending veto by China concerning the con-
tinuing assistance of Haiti.
Could there be some negative consequences in the event China
vetoes the resolution? Is there something that we should know
about this situation?
Mr. LEONARD. On the situation in New York, I would simply say
this is a moving train. A vote on this resolution has been put off
until tomorrow to see if some kind of agreement cannot be reached
on it.
China has indicated a number of problems that it says it has
with the resolution in its current form, both in terms of the dura-
tion of the U.N Mission, the time at which it would stay on, and
the size of the force.
The Chinese also-well, this matter is complicated by the fact
that China has no diplomatic relations with Haiti; and so that may
also enter into the problem-the Chinese have not vetoed a resolu-
tion in the Security Council, if memory serves, since about 1972.
And obviously we feel that this is not the time to start. Should
there be a veto, clearly we will have to try to see what steps could
be taken to achieve what we think is very important, the extension
of this greatly reduced U.N. force in Haiti.
You know, I cannot, at this point, enlighten the committee on
where we will come down and exactly how we will act in that even-
tuality, because I do not think those decisions have yet been taken
in that eventuality.
Mr. Goss. Going to the next question, the question is this: Going
back to the 7 November shooting the question I have here is: Who
has the evidence? Are we aware that they are making some links?
Mr. LEONARD. That killing took place in a district in Port-au-
Prince back in November, I believe, which was, at the time, the re-

sponsibility of the so-called interim public security force, the in-
terim police, that were stood up, consisting of ex-members of the
Haitian military.
What I understand is that the investigation into that killing and
the physical evidence involved is in the hands of the interim police,
which have since been disbanded.
Whether or not the special investigative unit of the Haitian po-
lice which has been created to look into these possibly politically
motivated killings has been able to take over responsibility for that
investigation from the interim police, I am not certain. I do not
think that that has happened.
There was one piece of evidence in that killing in the form of
some shell casings which were briefly in the hands of, I believe, one
of our RSO-that was briefly in the hands of one of our embassy
personnel who rushed to the scene.
He turned them over to a member of the international civilian
police who was an advisor to the IPSF. And that person in turn,
we are told, turned them over to the IPSF.
So that is the status of that investigation as far as we know it.
Now, Deputy Fortune, we know he has made some allegations
about the nature of his crime and who may have been behind it.
We have not had a chance to talk with him privately about those
allegations; so I cannot, at this point, give you more than what I
just mentioned.
Mr. Goss. Thank you. The third and last question I have: Does
the State Department have some evidence of what we would clas-
sify as fraud, waste, or abuse on the part of the Haitian Govern-
ment officials pertaining to either U.S. aid or international aid?
And I believe that would also apply to the election.
Mr. LEONARD. I personally am not aware of any concrete evi-
dence that we have of that kind of waste, fraud, or abuse involving
certainly our AID funds.
I would have to look and see if we have any such information
about the use of international funds. But, again, that does not
strike a bell with me.
There have been reports of government spending during the first
quarter of this fiscal year, during the period leading up to the Pres-
idential elections, in which the Haitian Government, as I said be-
fore, like a number of other governments, engaged in spending be-
yond what we had been led to believe the budget indicated.
But as for the spending of international aid funds and certainly
our own funds, no, I am not aware that we have any substantial
information on that kind of abuse. But I will certainly look into
that. And, if you would like, we can get to you with a definitive an-
swer on that.
Mr. Goss. I would very much like to pursue the specifics of that
question. I consider that open ended, and I do not think the audits
are complete yet. It may be based more on rumor than fact so far,
so I would be like for you to supply an answer for the record on
that question.
[Mr. Leonard's response: No. We have no evidence of such waste, fraud or abuse.
As you know, in the case of U.S. aid, the GAO is currently conducting a review of
financial oversight mechanisms and accounting procedures for our entire aid pro-
gram. We believe we have adequate safeguards in place that would have revealed
any waste, fraud or abuse. We nevertheless welcome the GAO review.]

Mr. LEONARD. Thank you.
If I could just add one last thing on this point. I know there has
been an audit going on by the GAO, for example, for the election
funds, our assistance to the United Nations and its assistance to
the Haitian electoral commission. Both an audit and review by AID
itself and I understand-is it concurrently, Mike, also by GAO?
Yes, so there is an audit going on both by GAO and AID's Inspec-
tor General, though I do not think we have the results of that yet.
Mr. KIM. [Presiding.] Thank you for that fine statement.
Congressman Foglietta, do you have any questions?
Mr. FOGLIETTA. No, thank you.
Mr. KIM. OK I do not have any questions for this panel. I want
to thank you very much for participating this afternoon in our
hearing. Thank you.
Mr. Preeg, Mr. Johnson, on behalf of the subcommittee, I would
like to thank you for coming today. Please give yourselves plus or
minus 5 minutes to give your statements.
Mr. Preeg.
STATEMENT OF HON. ERNEST H. PREEG, WILLIAM M. SCHELL
CHAIR FOR INTERNATIONAL BUSINESS, CENTER FOR STRA-
TEGIC AND INTERNATIONAL STUDIES
Mr. PREEG. Thank you, Mr. Chairman. I will try to summarize
my written statement, which is available for the record.
My basic point is that the situation facing the new Preval Gov-
ernment is very grim. And in key respects, it is more threatening
than the situation that President Aristide faced during the past 16
months. This is in terms of the political mandate, the internal se-
curity system, and the economic situation. It has been a long crisis
and is now getting worse.
In political terms, the political mandate between the two presi-
dents is quite stark to contrast. President Aristide was elected in
1990 in what was, for Haiti, an extraordinarily free and openly con-
tested election, encompassing a full range of political parties from
left to center to right and including outspoken debate in the media
and after which the losing candidate, however grudgingly, had to
accept the results.
And that made a difference. When President Aristide came back,
there was no question about his mandate and also his popularity.
In contrast, the election of President Preval last December was
seriously flawed in a number of respects. The provisional electoral
council was challenged by opposition parties. The media was har-
assed, with a few members beaten, and they were effectively si-
lenced. It was a very brief election campaign. All of the centrist
and conservative parties boycotted the election. They had won a
third of the vote 5 years earlier. And the turnout was estimated to
range from 15 to 28 percent. It was very low.
So you have President Preval with a much shakier political man-
date.
It is also less clear-well, it is clear that, to me at least, that
President Preval does not have the same kind of almost unques-
tioning support from his broad political base, center, left, Lavalas,
and other movements as is apparent in his initial attempts to form
a cabinet.

As to the internal security situation, again it is much more
threatening. During the last 16 months, there has been a credible
internal security force: It has been the U.S. force, which is now
leaving. There will be a very small Canadian force. But mainly it
is this new 5,000- or 6,000-person new police force in Haiti, which
is untrained and untested. It has been mentioned that there really
is no leadership structure yet, which could make a real difference
in effectiveness. It is a much smaller force than was in existence
in previous years in Haiti.
Haiti is a country of seven million people. A third of them are
in the congested, politically volatile cities; two-thirds are in the
countryside, very difficult, mountainous terrain. And one question
is: Who is responsible for maintaining law and order in the coun-
tryside? It is not clear to me.
One other point that has been made about the new security force
is the recent uncovering, if you will, of an independent Presidential
palace guard, which is apparently more militant politically and
probably better armed than the national police force. And there
have been some friction and incidents already. And this is another
throwback to earlier times where there has been a politicized police
force in the palace.
As to the economic situation, there is attached to my statement
a recent op-ed piece in which I tried to explain what was, in effect,
the Haitian aid bubble economy last year, 1995, and how this bub-
ble is deflating rather rapidly.
The international community had a firm commitment to seeing
President Aristide through his term; and the disbursement of some
$600 million was an extraordinary-and not to be repeated-level
of aid to a country the size of Haiti.
It amounted to 25 to 35 percent of Haitian GDP. But it was
linked to the implementation of various economic reforms to resus-
citate the private sector, to recreate the jobs that existed particu-
larly in the cities during the decade of the 1980's. That is critical.
And privatization, incidentally, is not principally the cement and
flour mill factories that have gotten all of the attention. They are
least important among the 11 firms that are public enterprises.
The main ones are infrastructure: electric power, telephones, and
the port facilities. They are not functioning. They are bloated. They
are corrupted. They need to be brought under good management.
Otherwise, there will be no resuscitation in the private sector.
Unfortunately, this bridging aid bubble, because the economy
was somewhat better last year because of the aid, was almost all
used on temporary relief for the poor and budget support to pay the
government payroll-that was another reform, the government was
going to cut down the size of the government by half. They admit-
ted when they came back, the Aristide Government, that the min-
istries, they have always been bloated, and committed to reduce
them. But in fact they went up somewhat in size because of all this
aid bubble.
So, consequently, the situation was that the aid has been ex-
pended, while unfortunately the Aristide Government's reform
record was one of brave words but almost total non-performance.
And that is what the situation is now. There is 70 to 80 percent
unemployment in the Port-au-Prince area, a political tinder box.

The aid is dropping rapidly. U.S. aid is going down by almost two-
thirds which alone is a drop of 7 to 10 percent in Haitian GDP, just
from the cut in the U.S. aid program.
Other aid donors this time around are saying: You have got to
have implementation of reforms first. You have got to have projects
that have lasting significance to help the economy. And what that
does is slow down the disbursement of aid dollars.
So this is a deflating aid bubble economy effect.
What does this all mean?
It is a grim picture on all fronts. And that has to be understood
in terms of what is next. In my own view, the United States does
have a self-interest in seeing that Haiti regains a reasonable level
of political stability and self-sustaining economic growth which will
endure beyond 1996. I believe our policy has been very short term
in its orientation without due regard for what happens next.
The U.S. interests in Haiti are important, particularly with re-
gard to protecting our borders against large, illegal migration, drug
trafficking, international crime, and other threats of that nature.
And, thus, the United States, in my view, should continue to pro-
vide strong economic support for the next stages of economic recov-
ery; although, this time it should be conditioned more firmly on re-
form implementation by the Preval Government and provide, for
the most part, through the private sector and private voluntary or-
ganizations.
The police training function should, likewise, be continued, condi-
tioned in this case on the police functions being maintained non-
political. And that certainly means no more political killings relat-
ed to the new police structure.
If the Haitian Government fails to meet these minimum stand-
ards, it has no one to blame but itself; and there is little the United
States can or should do to sustain it.
But at this critical juncture, it remains in the U.S. interest to
continue its conditional strong support and hope for sharply im-
proved performance by the Haitian Government.
Thank you.
Mr. KIM. Thank you. We will hold any questions until after the
statements.
[The prepared statement of Mr. Preeg appears in the appendix.]
Mr. KIM. Mr. Johnson.
STATEMENT OF PETER JOHNSON, EXECUTIVE DIRECTOR,
CARIBBEAN LATIN AMERICAN ACTION
Mr. JOHNSON. Thank you, Mr. Chairman and Mr. Foglietta.
I, too, would like to submit the written document for the record
and give you my views verbally, summarizing and perhaps a couple
of others.
The Caribbean/Latin American Action is an organization of some
120 American and Caribbean Central American companies that
pursues objectives of economic development and political stability
in that region.
Virtually all of the American companies that had been in Haiti
during the more active business years of the 1980's and even today
form a part of Caribbean/Latin American Action; and we have a
task force of those companies that engages actively with the pre-

vious government, hopefully with the incoming government, and
certainly over the past 15 years, with virtually every government,
trying to improve the business environment, better the economy
and improve the employment ratios in that beleaguered country.
I think I will virtually echo Ambassador Preeg's comments but
in a different way. And I do not really believe the companies that
I speak on behalf of see the problem as a complicated problem,
frankly, but one of enormous political courage.
It is not complicated simply because the facts are quite clear. If
we are looking today at a budget-in an emerging budget deficit at
the end of this year, as Haiti is, on the order of $150 to $160 mil-
lion, the budget deficit-there is no way on God's green earth that
it can be filled by revenues that come out of that economy. There
is simply no way.
The only way that economy or political leadership can solve that
problem is to do two things. One really it will accomplish-it will
have two objectives, two results.
They simply have to come to grips with the privatization, struc-
tural reforms, financial reforms that the various international in-
stitutions are requiring of them. By doing that, they are really ac-
complishing two things. One, they are going to cover that deficit
problem to a large extent because the funds are going to flow in.
And second-and this is what I want to dwell on a little bit-
is they are going to begin to solve the problem of the business envi-
ronment.
Today, as all of the companies that we work with and many oth-
ers that we do not, will tell us no one is going to invest money in
Haiti in the current investment environment. Haiti is simply not
a competitive place to invest. There are too many other places in
the Caribbean, such as Honduras such as-the Dominican Republic,
for the finite amount of foreign investment that is available, to risk
putting resources into Haiti.
By also accomplishing the structural reforms, specifically the pri-
vatization, they not only improve the business environment-and I
will take two of the institutions that Ambassador Preeg men-
tioned-they improve the telephone company and the electric com-
pany.
The telephone company in Haiti today has the poorest-the tech-
nical people, in telephone jargon, call it, I believe, the call-com-
pleted ratio. The telephone company has the worst call-completed
ratio in the hemisphere, probably in the world; I do not know that,
but I do know in the hemisphere.
This is an important business environment issue. Companies will
not go and invest in a place where they cannot communicate with
their markets, with their owners, or with their investors.
And the second, of course, is the electric company. The electric
company has as an enormous drag on the budget of Haiti. It is an
enormous drag. It is providing power 4 to 6 hours a day. And I
come back to the same point: no investor is going to create a com-
pany and create jobs in an economy where you cannot communicate
and you do not have power, leaving apart all of the other issues.
To capsulize that, to reduce the deficit, the structural reforms,
the privatization has to occur, it will allow the flow of international

financial resources, the $125 million, that is out there. That is not
too far off the $150, $160 million.
But at the same time, they get rid of that-these enormous drags
on the economy which they are supporting through bloated pay-
rolls, through total inefficiency, that will begin to cover much of the
rest of that deficit, that is, I am talking about electric; I am talking
about telephones; and we can talk, if you wish, about the flour
mills; and we certainly need to talk about the ports. And it goes
on from there to the total of seven or eight or nine, whatever that
number is.
But the port, the electric, the power, and the telephone are the
key ones to create-are the key drags; and they also create-by fix-
ing them, it will create the business environment we are talking
about.
Now just to make sure we all understand the dimensions of the
problem in terms of just the societal aspects of this, if you do not
solve the budget problem, you are going to keep printing money to
close the gap. You have got to pay the bills, so you are going to
print the money. We could also-right now we can easily see the
inflation rate which is moving steadily upward, quickly. That is
simply causing, Mr. Foglietta, an impoverishment deeper than the
deepest impoverishment that we have in this hemisphere today.
So it is absolutely the worst thing that we could have as we pull
the troops out and seek something stable as we go forward. I mean,
it is not a deficit or it is not a privatization problem, as I thought
I heard you mention before in the earlier panel, that we have to
go slow with this. I would argue just the other way: We have to
be courageous and help the Haitians to understand that this has
to be done as quickly as possible because the grinding impoverish-
ment and inflation is going to cause the situation to be worse.
We are dealing, as Ambassador Preeg mentioned, as I would cer-
tainily agree, with a country which has had an 80 percent unem-
ployment rate over the past 4 or 5 years. I cannot imagine living
in that kind of an environment. But that is an 80 percent employ-
ment rate compared to the 40, 35, 38, 40 percent employment rate
that existed in 1988, 1989, under the dictators.
It was an economy that was in some way functioning in those
days. It can function, but courageous political decisions must be
taken at the top to right the ship and right it quickly. The courage
has to be applied. The pain has to be absorbed and get on with
this. Because if we do not do it, all of these billions that we have
spent of the taxpayers' money is really, I am just totally convinced
we are going to look at 2 years from now and say: This was a com-
plete waste of resources and energy from all of us, from the busi-
ness side, the public sector, the Americans, the Haitians, and the
international community.
Thank you, Mr. Chairman.
[The prepared statement of Mr. Johnson appears in the appen-
dix.]
Mr. KIM. Those were fine presentations.
Mr. Foglietta, do you have any questions?
Mr. FOGLIETTA. Mr. Johnson, I appreciate your comments. I
agree with most of them. I do not know about the statistics,
though.

The only other comment I would like to make would be about the
statement made by Ambassador Preeg, namely that the election of
a few months ago electing President Preval led some opposition
party to objecting to the vote.
I would say that in the prior election of Aristide 5 years ago that
the opposing parties accepted the results of the people. They ac-
cepted them by putting guns and pistols to Aristide's head and
threatening to blow his brains out and forcing him into exile by a
coup to take over the country. I do not think that is very acceptable
on the part of the opposition parties.
Mr. PREEG. Well, let me clarify. At the time of the election, the
opposition parties who got one-third of the Presidential vote, and
elected the majority of the national assembly, accepted the results.
And then there was a subsequent 8 or 9 months of the Aristide
presidency, which was a very troubled period, I might say, and
there was some killing toward the end. And it was elements of the
military that overthrew Aristide. It was not the political parties.
Really for what Haiti has been through in its history, that period
of 1989-90, while there was a set back, was a period when there
was a great deal of hope toward political reconciliation. And the
parties were not-
Mr. FOGLIETTA. Do you-
Mr. PREEG. Pardon me.
Mr. FOGLIETTA. Are you talking about the last election?
Mr. PREEG. Leading up to that period. And even the military, of
course, on the night of the election, elements of it-the better ele-
ments were keeping peace at the voting booths.
It was the most positive election in Haitian history.
Mr. FOGLIETTA. Aristide did not serve his entire term as presi-
dent.
Mr. PREEG. Well, there was an interim government. There were
4 years-well, call it what you will, but there was an openly con-
tested election in 1990. Political parties, Aristide, centrists, others,
openly contested, the media were wide open, and were all over the
place.
Mr. FOGLIETTA. I was there.
Mr. PREEG. Were you there for the-
Mr. FOGLIETTA. I was there prior to the election. I saw no evi-
dence whatsoever of any intent to muzzle the press or anything
else. I mean, it looked like to me it was a totally open election.
Now, certainly the impression I got was that there was over-
whelming support that President Aristide enjoyed at that particu-
lar time. I talked to people all over Haiti. The position of 95 per-
cent of the people I talked to, probably 90 percent of the popu-
lation, was that they did not want him to actually leave. They sup-
ported him so strongly that they wanted him to remain in office for
3 more years, to make up for the 3 years he had been exiled.
And I also believe that is why the percentage of people voting,
28 percent, was so very low, because they did not want to elect
Preval; they wanted to keep Aristide as their president, with the
strength that he had, the support that he had among the people.
Thank you, Mr. Chairman.

Mr. KIM. I have just a couple of questions. Honestly, I do not
know much about Haiti, except for what I've watched on TV. And
it sounds like the media people have a very pessimistic view.
How could all of this happen? We had international police out
there watching.
Mr. PREEG. Well, again, I have been following press reports close-
ly. I did not go down there. There were three or four incidents in
the weeks prior to the election. In Cape Hatien in the north, the
head of the biggest radio station, that was anti-Aristide, the head
of that station, she was in her car with her children and a mob
went after her and threatened her. She went into hiding, and the
radio station closed down.
There were two or three journalists-I believe they were in the
Port-au-Prince area-that were beaten up. And my understanding
is that the opposition media has sort of quieted down. There was
no outspoken criticism of the Aristide Government or for Preval in
the way there had been in earlier years. That is my understanding
of this. It was only a 2-week election period anyway.
Mr. FOGLIETTA. Well, I was not aware of that. The fact is this
week-and I will not deny that this is a very volatile community
of people. They are volatile because there are no results there. But
when they see opposition, you are talking about people who do not
want to return to the days of the military dictatorship under Fran-
cois and under Cedras where 4,000 or 5,000 people were killed.
There was no law there whatsoever. We have to try to understand
the situation, you know, where these people are coming from.
Like I say, I was there. I heard no reports whatsoever. Now
there may have been incidents like this, but I did not hear of any.
The fact is, I was there.
Mr. PREEG. If I might try to answer a little bit.
Mr. KIM. Sure.
Mr. PREEG. My own assessment is that the situation is more
complicated in Haiti in terms of polarization between, essentially,
the one-third that voted against Aristide 5 years ago and the two-
thirds.
Very few of that one-third had much use for the army. And much
of that one-third was caught in the middle, between a rock and a
hard place. There are not just the centrist groupings that fear
Aristide and his group as having been revolutionary left, even com-
munist-inspired. And certainly a lot of things coming from that
movement still raise that concern.
There are significant segments of the Haitian population in the
countryside, too, that are very conservative and traditional and
view Aristide and Preval as radical left revolutionaries. There are
splits among protestant missionaries who have their outreach. The
voodoo church is not just to the right politically but a very deeply
ingrained religion as well.
Mr. FOGLIETrA. Catholics are involved?
Mr. PREEG. The Catholic religion is split. So there are conserv-
ative elements in the countryside and the city who did not like the
army, particularly the bad elements who took over, unfortunately,
during the 3-year embargo period but were caught in the middle.
And as far as who voted, a lot of people, as you say, did not vote
because they wanted Aristide to stay on. But of the one-third that

23-747 96 3

voted against Aristide 5 years ago-and I happen to have contact
with many from the business sector and elsewhere-it is rare that
I have found anyone who was against Aristide 5 years ago and is
for Aristide and Preval now.
On the other hand, some of the segments that were pro-Aristide
5 years ago have gone over, including Victor Benoit, one of the only
credible opposition candidates, and Evans Paul, the former mayor
of Port-au-Prince.
So I still think that while a majority was clearly pro-Aristide,
there was a large minority who was not out in the streets and who
do not talk and get interviewed very often, quite frankly, in too
much of what I refer to as curbside quotes from the press. People
in the street are 100 percent Aristide. And the anti-Aristide people
are worried. They are worried about crime. They are worried about
corruption, which has gotten a lot worse, from what I have heard,
in the last year. They are staying home.
Mr. KIM. Well, it seems like after we spend almost $2 billion to
overthrow this General Cedras, perhaps the people in Haiti still
have corruption going on, still other crimes going on, the economy
is bad. There is not much to show for the economy.
Is that your assessment?
Mr. JOHNSON. Mr. Chairman, I would like to comment just on
that. It is not terribly profound. What has to be done in Haiti today
has to be done in Haiti.
I get kind of disturbed some times at the United States, which
is taking such a major responsibility in the events of the last cou-
ple of 3 years.
You sense a tendency to say, we have done our job and we pro-
vided the opportunity-the remarks that I heard earlier in the pre-
vious panel. It is not as simple as that.. Haiti has always had a
close relationship with the United States. The United States has
always tried to help in different ways, not as vigorously as we tried
to provide this opportunity in the past couple of years.
But I think the assessment that we were generally concluding is
true with respect to the economy. And the assessment is true with
respect to Haiti's improving economy. An improving economy has
to take the place of the military forces.
Then the United States must take a role. It may be only persua-
sion. Frankly, I think groups like mine and other companies have
a self-interest in helping Haiti to understand what it will take to
create a competitive business environment.
Certainly we never suggest to tell you all your business, but it
would seem to me that this committee must take a very aggres-
sive-Democrats and Republicans; we are all in the same boat
here-take a very aggressive role in urging the American Govern-
ment to insist on these reforms, to insist on courageous political be-
havior for the sake of what we have done and for the sake of the
people in Haiti.
We do not have a lot of alternatives, as we have said before. Cer-
tainly one of those alternatives is not to pour more money in. We
have to have a political objective down there. We have to provide
part of that constituency underneath which those courageous politi-
cal decisions are taking place.
Mr. PREEG. Could I add a couple of thoughts?

Mr. KIM. Yes.
Mr. PREEG. While, regrettably, as I mentioned earlier, the eco-
nomic situation is worse now.
Mr. FOGLIETTA. Worse than what?
Mr. PREEG. Worse than 16 months ago. Except for the temporary
aid bubble effect there has been very little movement not only on
the government reforms but on the kind of assistance in long-term
projects which I certainly favor, particularly in a country like Haiti.
Now, how to get out of it? My feeling is that Haiti-and this has
been going on for several years-needs a political reconciliation.
And certainly my hope for the Preval Government is that he will
reach out to some technocrats and members of the business com-
munity and others to give them confidence and to give the govern-
ment the managerial capability to implement what are going to be
extremely difficult steps to get things going again. Because the aid
bubble effect is not going to be there.
And I have just two specifics, if I might add.
Despite all of the downsides of the earlier regimes-and I was
down there in the early 1980's when it was still the Duvalier Gov-
ernment--when, although there were not political killings, it was
an authoritarian dictatorship-they were creating jobs.
And of the one million people in Port-au-Prince at that time, ap-
proximately half a million were supported directly or indirectly by
this labor-intensive industry that had been developed. New infra-
structure that was there; and there were 200 companies, mostly,
related to the U.S., 60,000 jobs. And most of the other half of Port-
au-Prince was working in the domestic sector.
So there was a bustling economy. In fact it was referred to in the
early 1980's as the Taiwan of the Caribbean.
Now that industry has been wiped out principally through the
embargo, quite frankly. I think we should all reflect again on the
downsides for using the embargo as a mechanism to try to get rid
of reprehensible governments, of which there is no question that
the military was.
The second and last point-and I take a little issue with Peter
on this one-this year aid disbursements will not be $600 million-
they might be $300 or $400 million, I am just using a rough esti-
mate-and of this $150 million he is talking about is the portion,
almost half of the total, that is earmarked for what is called budget
support, where we use our taxpayers' money to pay the payrolls
and the central government budget.
We never did that in Haiti before or in most other countries.
There are ways to use aid money not for budget support but for ag-
riculture and help in the countryside and for infrastructure or sec-
ondary roads.
So, Peter, I think they can get that $150 million budget deficit
down by reducing the size of the government payroll as they said
they were going to do; they can also do it by increasing some tax
revenues; and I will just conclude by noting a suggestion I have
made, that I think would make the Preval Government very popu-
lar all around, at home and abroad, which is to do what some other
governments have done, Indonesia in particular to privatize, in ad-
dition to electric power, telephones, and port facilities, or rather to
put under private management the Haitian customs service.

The Customs Service has always been a disaster, and it has got-
ten worse this past year. With one stroke of the pen, President
Preval could bring in revenues, build confidence in the private sec-
tor, and be a popular president for all Haitians except that small
number of people who are on the take, on the very big take, in the
Haitian customs service.
Mr. KIM. Mr. Foglietta, do you have anything further on that?
Mr. FOGLIETTA. Let me try to conclude. We could continue on
this discussion all day. But I do have a couple of things.
No. 1, you said that the economy is not better now. I do not see
how that could possibly be. Haiti now has a positive 4.5 gross do-
mestic product. And prior to Aristide's return, it was minus 10 per-
cent.
No. 2, we talked about unemployment. There are people working
in sugar cane fields under slave labor.
No. 3, we heard the lumber industry was an important port in-
dustry. You cannot practically find a tree standing in the whole is-
land of Haiti right now because it was raped by companies coming
in and cutting them down.
You call that good economy. I do not. I think what we need to
do in Haiti is grow a solid economy so the people can work in de-
cent jobs and live a decent life.
Mr. PREEG. May I respond briefly?
Mr. KIM. Sure.
Mr. PREEG. I agree with you totally on the deforestation and the
terrible environmental disaster. Actually I just came out with a
book 2 weeks ago on Haiti-maybe that is one reason I am here
today-and there is a whole chapter on that. It is a terrible trag-
edy.
Actually, though, the half million people in Port-au-Prince I
noted were not in lumber, but assembly and other labor-intensive
industries, which is what Haiti needs. And it was there, despite the
political repression.
As to the 4 to 5 percent-the Clinton administration and Aristide
Government indeed said that last year, the Haitian economy grew
by 4.5 percent after it had declined by 30 percent during the em-
bargo years. And the embargo years really wiped out the economy.
But that 4.5 percent is in the context of the aid bubble. The dis-
bursement of aid amounted to 25 to 35 percent of GDP. And my
question is, if you put in 25 to 35 percent of aid disbursements,
why did the overall economy only grow 4.5 percent?
And we know this year that the cutback in U.S. aid alone will
bring it down 7 to 10 percent; and other aid disbursements will
probably slow as well.
So there was the aid bubble effect, and my reaction has been,
why was it only 4 or 5 percent when we were piling in so much
aid, which had the immediate impact of raising the economy?
Mr. KIM. Thank you all very much for your testimony. If there
are no more questions, I would like to thank you for coming today.
Your presentations were excellent.
This hearing is adjourned.
[Whereupon, at 3:50 p.m., the subcommittee was adjourned to re-
convene at the call of the Chair.]

APPENDIX

Statement of
The Honorable Thomas M. Foglietta

Before the

House Subcommittee on Western Hemisphere
Committee on International Relations
"Haiti and the United Nations Mission"

Wednesday, February 28, 1996

Mr. Chairman, and Members of the Subcommittee, thank you for

allowing me the opportunity to appear before you today to discuss a

subject of great importance to our nation and the world community,

Haiti and the struggle of its people for democracy, freedom and

economic empowerment.

I hope to help you answer the question that faces us today in this

hearing: what happens when the UN force leaves.

I am optimistic about the future of Haiti, now as U.S. troops finish

out their mission. For the first time in Haiti's two-hundred year history,

hope is alive, and hope is a first, giant step towards genuine democracy

and real economic progress and empowerment.

I visited Haiti four months ago -- my fifth trip in three years. My

first trip in 1993 took place before President Aristide's return to power.

I saw the scars from the meanest violence you can imagine, desperate

poverty and fear that plagued this island nation. But the faces of the

Haitians changed upon Jean-Bertrand Aristide's return to power in

1994, thanks to the intervention of the United States. I saw Haitians

cleaning their streets and their neighborhoods. I saw Haitians rebuilding

small businesses and fixing and cleaning schools and classrooms.

The strides we have made to restore peace, democracy and

economic development in Haiti are enormous. Let's compare the world

facing Haitians now compared to just three years ago. In 1993, Antoine

Izmery was attending mass in Sacre Coeur Church in Port-au-Prince.

He organized the service to commemorate the fifth anniversary of the

attack by government thugs at St. Jan Bosco Church. Tragically,

another group of faceless thugs stormed the church and dragged Izmery

out into the street. In broad daylight, he was beaten and shot in the head

at point blank range. Sad as it was, this was just one example of the

4,000 brutal murders that occurred during the military dictatorship

following Aristide's overthrow from office.

Thanks to the actions of President Clinton and the American men

and women in uniform who have served in Haiti, people no longer live in

fear. Democratic government and the rule of law have returned to

Haiti. The army has been abolished and a civilian controlled police force

and Citibank, had the confidence to participate in six U.S. Department of

Commerce Business Development Missions to the country. And 25

corporations and non-profit organizations are members of Commerce's

U.S.-Haiti Business Development Council.

The transition has not been without blemish, but I know from first

hand experience that criticisms about our role in Haiti have been inflated

and often fail to accurately take into account the positive evidence of

progress in Haiti.

In addition, we witnessed the peaceful and democratic transition of

government with the election of a new President, Rene Preval. From

this evidence of giant steps towards democracy and economic progress, I

conclude that our mission in Haiti is a great military and diplomatic

success story.

The challenge in the coming months and years will be to build on

the steps already taken. I urge my friends in Congress and the

international community to make sure that every effort be made to keep

37

Haitians on the path towards peace, democracy and economic stability.

Organizations like the International Monetary Fund, the United Nations,

the U.S. Congress and others, will be critical to maintaining stability in

Haiti. I welcome their continued participation and leadership in this

effort.

What is tomorrow for the people of Haiti? It is a tomorrow of

challenge, but it is a tomorrow of faith and hope. And that tomorrow

has been defined by what our government and our servicepeople have

accomplished today and yesterday.

Thank you.

STATEMENT OF JOHN P. LEONARD

DIRECTOR, HAITI WORKING GROUP

DEPARTMENT OF STATE

BEFORE THE

HOUSE INTERNATIONAL AFFAIRS COMMITTEE

SUBCOMMITTEE ON WESTERN HEMISPHERE AFFAIRS

FEBRUARY 28. 1996

I welcome this opportunity to testify on the withdrawal of

UNMIH and its impact. I would like at the outset of our

discussion to put our subject in the context of the

accomplishments of the last eighteen months, some lessons

learned and the main challenges the Haitian government still

confronts.

At the height of the US military presence, shortly after

the MNF's initial deployment, there were over 23,000 American

military personnel in Haiti. As of September, 1995, there were

2,500 American soldiers, out of a total of 6,000 UN

peacekeeping troops, and 800 UN civilian police, drawn from 31

countries. By mid-March 1996, only a few hundred US members of

the UNMIH force are to remain in Haiti, and the last of these

are scheduled to depart by a month later.

US forces now leaving Haiti have successfully contributed

to two complex and challenging tasks: first, the dismantling

of Haiti's old institutions of repression and the creation of a

new professional civilian police force and reformed judiciary;

and second a democratic renewal which involved five elections

during the past year and the first transition from one

democratically-elected president to another. Both of these

achievements met the timetable which the United States and the

United Nations had set for this peacekeeping operation.

Needless to say, Haiti's democracy remains fragile, its new

security structures inexperienced and untested, and economic

renewal is at best tentative. But, a year and a half after the

American led intervention, the economy has stabilized, and the

political and security situation in Haiti has dramatically

improved. These improvements have advanced to a point which

permits a more modest onward international presence in Haiti,

one to ensure a smooth and sure transfer of key functions

enabling Haitians to assume complete responsibility for their

own future.

Even acknowledging that the road ahead for Haiti is

anything but smooth, this operation has been a success.

Indeed, any large scale international peace operation which

begins peacefully, proceeds smoothly, and achieves its goals on

schedule stands out in the annals of international peacekeeping.

LESSONS LEARNED

The American-led international intervention in Haiti has

proceeded smoothly, successfully and on schedule because:

* First, the international community set and adhered to a

clear set of objectives. These were:

-- Restoration of the legitimate, democratically-elected

authorities;

-- Dismantlement of the old instruments of repression;

Assistance in creating new professional and apolitical

security institutions, including a new police force

and a reformed judiciary; and

-- Creation of a climate of security in which those

achievements could function, and democratic processes

such as elections could resume their operation.

* Second, we were able to secure and maintain broad regional,

hemispheric and international participation for Operation

Uphold Democracy and its UNMIH successor. As of mid-1995,

troop and police contingents from over 40 nations had

served with the MNF or UNMIH.

* Third, in both Operation Uphold Democracy, and UNMIH, we

and our allies achieved the closest possible integration of

diplomatic, military, humanitarian and economic support

efforts.

* And finally, we recognized and accepted that, because no

country other than the United States was capable of

mounting, integrating and sustaining a complex

multi-agency, multifunctional, and multinational enterprise

on this scale, US leadership was essential.

The US-led intervention of September 19, 1994, followed by

the 18-month presence of MNF and then UNMIH international

peacekeeping forces, has provided Haiti an opportunity to come

far toward establishing a credible democracy, effective and

publicly-accountable law enforcement institutions, and the

foundations of long-overdue reform to establish a

self-sufficient economy. A good deal of progress has been

made. However, reforms are still incomplete, and new

institutions still fragile. They will be tested as the

international military presence winds down.

The gradual withdrawal of UNMIH's US contingent began in

December and will be completed April 15. This number will drop

to an estimated 400 by March 15. These 400 will be residual

forces --for example, medical, engineering, and aviation units

-- that will help ensure a smooth transition to a reduced

international presence as a final step to Haiti's assumption of

full responsibility for its own future.

President Preval of Haiti has asked for an extension of the

UN force in Haiti, to help the Haitian police maintain the

climate of security which has been established. The UN

Secretary General has recommended a follow-on force somewhat

less than one-third the size of that currently mandated: about

1,900 troops and 300 civilian police compared with 6,000 troops

and 900 police under the current mandate. Its mission will be

to assist the new Haitian national police and to help protect

the Haitian government. The UN Security Council is acting this

week on the Secretary General's recommendation. The United

States supports this recommendation, as do the other

governments of the region as well as those others which have

been most deeply involved in Haiti. Although Haiti has been

stabilized, it is sensible to withdraw peacekeepers gradually

to guard against a possible upsurge of violence.

THE ROAD AHEAD

We support the extension of a reduced UNMIH, as an

appropriate and necessary means of supporting the new Haitian

police and the newly-installed Preval government. This

extension will enable the Government of Haiti to consolidate

its ability to maintain the stable and secure conditions that

are a precondition to addressing the range of serious economic,

political and social problems Haiti still confronts:

reassuming responsibility from UN forces for the country's own

internal security; applying lessons learned in five elections

in 1995 to institutionalize a fair, free and peaceful electoral

system; and carrying out crucial but, what for many Haitians

inevitably will be painful, economic reforms. The US and other

governments are committed to assisting, but only the Haitians'

own resolve and ability to make difficult decisions will

determine success or failure in the end.

To sustain the climate of security and stability that has

been achieved since the MNF intervention in September 1994 the

Haitian government must convince the Haitian people, and

potential investors at home and abroad, that the stability

established under international peacekeeping arrangements will

continue after responsibility fully returns to the Government

of Haiti. The seamless transition from the MNF to UNMIH was

key to UNMIH's success in keeping the peace. Our long-term

engagement in helping Haiti to resolve its problems is a

critical incentive for domestic stability and increased

domestic and foreign investment in the economy.

Reform of law enforcement in Haiti has just begun. The

graduates of the Haitian police academy have had to meet high

standards and undergo rigorous training. However, the most

experienced members of the HNP have much less than a year's

experience as policemen. An onward international presence can

make the difference between success and failure of the new HNP

by filling this "experience gap" with international field

training officers.

To recognize how the situation has improved is not to suggest

that further steps are not needed to eradicate political

violence from Haitian life. Haiti has a long, sad tradition of

political abuse and intimidation which, if not checked once and

for all. could undermine its democratic renewal. Similarly,

Haiti's economic renewal is at best tentative, its electoral

system remains fragile, and its government institutions are

inexperienced. The international community's help will

continue to be needed to help Haitians overcome the liabilities

of abject poverty and generations of government neglect.

As our military forces depart from Haiti having successfully

accomplished their mission, we should note that this does not

mean the U.S. is withdrawing from Haiti. Haiti has long been a

major aid recipient as we have sought to ameliorate the human

misery caused by years of mis-government. The work our armed

forces has accomplished provides us an unprecedented

opportunity to invest our assistance in the creation of sound,

self-sustaining democratic institutions, the rule of law, and a

functional economy, and thus ultimately to end the burden that

too long has been imposed on the Haitian people. Much remains

to be done.

But a new beginning has been made. As we previously have said

before this Committee, as our troops and those of other nations

depart they will leave behind a legacy of democracy restored,

and hope renewed.

STATEMENT BY
JOHN CHRISTIANSEN
DIRECTOR, HAITI TASK FORCE
OFFICE OF THE SECRETARY OF DEFENSE
BEFORE
THE SUBCOMMITTEE ON WESTERN HEMISPHERE OF THE
INTERNATIONAL RELATIONS COMMITTEE
UNITED STATES HOUSE OF REPRESENTATIVES
FEBRUARY 28, 1996

Mr. Chairman and Members of the Committee: I appear before this subcommittee
today in regard to the ongoing withdrawal of U.S. Forces from the United Nations
Mission in Haiti (UNMIH). A great deal has transpired since U.S. military forces entered
Haiti on September 19, 1994. You will recall that Operation UPHOLD DEMOCRACY
was conducted against a repressive military regime which had, since 1991, defied
international will and the demands of the United States Government to return the
constitutionally elected government to authority in Haiti.

The United States had several interests in that action:

The ouster of President Aristide by military coup d'etat in 1991, if allowed to stand,
threatened to affect stability and democratic development elsewhere in the region.

The outflow of Haitians seeking refuge from poverty. and oppression not only
threatened social stability throughout the region, but also placed significant strains
on our own national security and hemispheric interests.

After diplomatic efforts failed to dislodge the de facto regime, the U.S. prepared to
use military force as part of a Multinational Force (MNF) authorized by United Nations
Security Council Resolution 940 (1994) to use all necessary means to secure the
departure of the coup leaders; to restore the legitimate, democratically-elected
Government of Haiti; and to create a secure and stable environment that would allow
the Haitian people to assume responsibility for rebuilding their country. On the eve of
intervention, September 18, 1994, an agreement was reached with Haiti's de facto
leadership that would facilitate departure of the coup leaders and allow return of the

elected government. Within hours the U.S. invasion force was able to reorient and
redeploy to enter Haiti peacefully in order to carry out the provisions of UN Security
Council Resolution 940.

The U.S.-led multinational force peacefully entered Haiti the next day. It quickly
achieved its initial objectives. The Haitian military leadership departed Haiti by October
13 and President Aristide returned to Haiti on October 15, 1994. Meanwhile,
Government offices were restored to the control of the legitimate officials. Inherent in
the U.S. forces' mission was also the protection of U.S. citizens and U.S. facilities. The
MNF operation was conducted through March 31, 1995, during which in excess of .
20,000 American service men and women from the U.S. Army, Navy, Air Force, Marine
Corps, and Coast Guard served in conjunction with approximately 5,000 non-U.S.
forces and civilian police personnel from 31 nations.

In the months that followed, the U.S. and coalition presence expanded throughout
Haiti, providing a more secure environment and helping to coordinate international
humanitarian assistance for the most needy Haitians. Aggressive weapons control and
reduction measures were initiated that seized weapons posing a threat to the MNF and
reduced the number of illegal weapons in Haiti. Essential public services, such as
electrical power, were restored in key areas. Direct assistance to Haitian government
ministries by military civil affairs specialists was vital to helping them reestablish
functional governance and begin rebuilding Haiti's public institutions. As conditions
improved, we repatriated over 13,000 Haitians who had fled Haiti under the military
regime. Under the secure conditions provided by our military operations, meanwhile, a
major effort began to build a completely new and professional police force for Haiti,
under civilian control. While this force was being recruited and trained, an interim public
security force made up of ex-members of the Haitian Armed Forces who were screened
for serious criminal or human rights violations, carried out the police function under
supervision by the MNF's International Police Monitors.

The exit strategy for ending MNF deployment was the transition of responsibility to
the United Nations Mission in Haiti. On January 30, 1995 the United Nations Security
Council passed UNSCR 975 recognizing that a secure and stable environment existed in
Haiti and authorizing the UN Secretary General to terminate the mission of the MNF and
to deploy UNMIH. On March 31, 1995 the U.S.-led MNF transitioned responsibility for
operations in Haiti to UNMIH.

At its peak, UNMIH had a civilian staff of some 600, approximately 6,000 military
and about 900 civilian police officers to assist the democratic government of Haiti in
sustaining the secure and stable environment established by the MNF, in protecting
international personnel and key installations, in establishing an environment conducive
to the organization of free and fair elections, and in creating a separate civilian police
force. In addition to providing the Force Commander, Major General Joseph Kinzer,
USA, approximately, 2,400 men and women of the U.S. Armed Forces comprised the
backbone of UNMIH with combat and support forces such as infantry, special
operations forces (which include special forces, civil affairs and psychological
operations), headquarters staff, aviation, medical and military police.

Like the MNF before it, UNMIH's military component expanded its presence
throughout Haiti in order to assist the GOH in maintaining the secure environment
which had been established by the MNF. UNMIH'S Civilian Police (CIVPOL) has
worked closely with Haitian authorities to provide on-the-job training and guidance to
the new Haitian National Police (HNP) officers now deployed throughout much of Haiti.
Of note was UNMIH's significant contribution toward enabling free legislative and
presidential elections, and its provision of technical assistance for the entire electoral
process. The timely conduct of the presidential election was an essential step in
consolidating constitutional order in Haiti--a step which led to Haiti's first-ever transfer
of power from one freely-elected leader to another, which took place on February 7,
1996 with the inauguration of President Rene Preval..

These many accomplishments in Haiti, under both the MNF and UNMIH, are due, in
large part, to the professionalism and dedication of our armed forces. The United States'
military has performed superbly: acting decisively, responsibly, and humanely in
carrying out a difficult and complex mission. Though U.S. forces led this mission, great
appreciation must go to all nations whose contributions to the Multinational Force and
UNMIH have made our efforts in Haiti a model of international cooperation for peace
enforcement.

Much remains to be done in Haiti, but the military role has markedly diminished. We
see at this time no organized threat to the Haitian Government or the international
presence. However, it is possible that opponents of democratic rule in Haiti may become
emboldened by the diminution of the international presence and move to attack

government officials or disrupt the functions of government. To meet its public safety
needs, the Government of Haiti has fielded a civilian police force of over 5,000, with
training and other assistance provided by the U.S. Department of Justice International
Criminal Investigative Training Assistance Program (ICITAP) and other international
contributors. As noted by the UN Secretary General in his most recent report on Haiti,
observers are nearly unanimous in their assessment that Haiti's fledgling police force
needs the support of UNMIH for a while longer, in view of the potential threats to the
Government, the problem of common crime, and the inexperience of the Haitian National
Police.

The UNMIH mandate established under UNSCR 940 continues through the
transition of power to Aristide's duly-elected successor Rene Preval during February,
1996--it is currently set to expire on February 29, 1996. President Preval has requested
an extension of the UNMIH mandate, and the UN Security Council is now considering a
resolution which would extend UNMIH's mandate for an additional six months at
reduced military and civilian police component levels of no more than 1900 and 300,
respectively.

The withdrawal plans of U.S. Forces Haiti, the U.S. contingent of UNMIH, will be
briefed by my colleague from the Joint Staff so I won't address that aspect of DoD's
involvement in my statement. I think it important to note, however, that after the small
transitional contingent which he will describe concludes its support of UNMIH,
anticipated to occur not later than April 15, 1996, the U.S. military will not participate in
a follow-on UN mission in Haiti. DoD will continue its engagement in Haiti on a normal,
bilateral basis, through participation in activities such as Exercise FAIRWINDS, with the
primary purpose of training U.S. forces. These deployments include both engineering
and medical. Engineering projects include water wells and school/hospital renovations,
and are similar to those done throughout the hemisphere.

The total incremental costs reported for U.S. military participation in Haiti-related
operations total $942.1 million through Fiscal Year (FY) 1995. This figure includes U.S.
participation in both the MNF and UNMIH, as well as costs incurred in support of
sanctions enforcement, migrant operations and support for foreign forces and Haitian
police. Financing of $89.4 million is required for FY 1996 incremental costs for U.S.
military participation in UNMIH through February 1996, to include costs for
redeployment. Funding will be requested through a reprogramming action currently

being staffed for transmittal to Congress.

Let me conclude by saying that the way in which the MNF and UNMIH missions
have been planned and executed incorporated many of the lessons learned in past
operations. Those lessons include the need for:

A clearly defined mission and objectives, as well as an established exit strategy.

Planning that integrates all dimensions -- military, political, social, and economic --
critical to the success of such an endeavor.

A commander on the ground who has been granted the capabilities and operational
flexibility to protect his forces and accomplish his mission.

* Recognition that in face of the challenges involved, and the U.S. interests at stake, it
is best for the United States to accept leadership of the mission and to commit the
largest share of forces.

* Finally, ongoing evaluation of the overall mission objectives, activities of our forces,
and their capabilities as the situation on the ground evolves to ensure that these
remain mutually consistent.

These factors have contributed significantly to our success thus far in Haiti. We are
now entering another phase of the task we undertook in September of 1994. Although
the UN mission, and the U.S. role in accomplishing it, will be different after February 29,
1996, the Administration's focus remains providing Haiti with an opportunity to develop
its public safety and civil services and the Haitian judiciary, and to create the other
conditions needed for economic, social and democratic development. We in DoD plan
to remain engaged in Haiti, albeit at a lower level of activity. I am hopeful that the
success achieved to this point will continue in the weeks and months ahead as the
transition of responsibilities from UNMIH to the GOH continues and as the Government
of Haiti assumes increasingly greater responsibility for its own security and governance.

51

Center for Strategic & International Studies
Washington. DC

Statement of Ernest H. Preeg
William M. School Chair for International Business,
Center for Strategic and International Studies
Washington. D C.
before the House International Relations Committee
Subcommittee on Western Hemisphere
February 28, 1996

Haiti After Aristide

The departure of the U.S. contingency of the UN peacekeeping force from Haiti
constitutes only one part of a greatly changed -and much more threatening -set of
circumstances facing Haiti with the completion of President Jean Bertrand Aristide's
term of office and the inauguration of his successor, Rene Preval. Haiti is now faced with
the mutually reinforcing circumstances of a more unstable political relationship, a weak
and untested new police force in the face of growing violence and crime and, most
threatening, a sharply deteriorating economy already in a state of prolonged crisis.

All of these circumstances changed markedly for the worse with the departure of
President Aristide because of the distinct nature of the situation during the previous 16
month period. Let me explain this changed situation for each of the three areas of
concern: the political relationship, internal security under the new police force, and the
economic crisis.

In political terms, Aristide was elected president in 1990 in what was for Haiti an
extraordinarily free and openly contested election-encompassing the full range of
political parties from left to center to right and outspoken debate in the media-and after
which the losing candidates, however grudgingly, accepted the results. There was
therefore no question of Aristide's legitimacy, once returned, and his broad popular
support was also unquestioned.

The presidency of Rene Preval, in contrast, begins under dark political clouds
relating to both the election process that brought him to power and the uncertain

cohesion of the left-oriented political movement -most prominently the Lavalas
organization -in support of his presidency. The December 1995 presidential election,
compared with that of 1990, was deeply flawed. The provisional electoral commission
responsible for supervising the elections and counting the ballots was denounced by all
opposition parties as controlled by Aristide partisans, and never received the
constitutionally required approval of the National Assembly. Opposition media-radio
stations and newspapers -were threatened, a few of its members beaten, and
consequently there was no media questioning of the Aristide record or the Preval
candidacy. The elections were announced in the last minute and the election campaign
limited to a couple of weeks. For all of these reasons, all center and conservative
political parties -which had received one-third of the vote in 1990-boycotted the election.
Of the dozen declared candidates, all were political non-entities except Preval and one
other-Victor Benoit -who heads a small center-left party that supported Aristide in 1990.
Only an estimated 15-28 percent of the population turned out to vote. Thus, the contrast
between Aristide and Preval, in terms of a clear electoral mandate from the people, is
decidedly negative for Preval.

As for the cohesion of the Lavalas political movement, it is clear that President
Preval does not command the high degree of almost unquestioning support as had his
predecessor. This has been evident in the lengthy process underway for selecting a
cabinet, and raises questions about the capability of Preval to act decisively on the
difficult economic and other issues he will have to confront in the months ahead.

Turning to the internal security situation, the highly credible internal security
force since September 1994 has been predominantly the U.S. military contingent,
progressively phased down from 20,000 to 3,000, and now pulling out. It will be replaced
by a much smaller UN force totaling 3,000, with its credibility for maintaining order
centered on a Canadian contingent of only 600, and the new, inexperienced Haitian
police force of 6,000.

Once again, the contrast between the Aristide and Preval situations is stark. The
new Haitian police force, in particular, is untested and quite small for a country of seven
million people, one-third in congested, politically volatile cities, and the other two-thirds
in a countryside of extremely difficult mountainous terrain. In the Duvalier period up to
1986, there was a more experienced Haitian army of 6,000-8,000plus a 15,000-20,000
part time trained militia-the infamous Macoutes -predominantly located in the
countryside. From 1986-1990, with the official demise of the Macoutes, there remained a
security structure in the countryside under the control of the unpopular but effective
"Chefs de Section." One question now is who will be responsible for maintaining public
order in the countryside.

Two other issues pertaining to the new police force are disturbing and bear
noting. The first is the lack of an organized officer structure within the police force. This
brings into question the operational effectiveness of the new police force and leaves

open the possibility that police leadership will be filled with militant supporters of the
presidency, as often happened in Haiti in the past when the army became a politicized
force of repression against opposition political groupings. The second issue is the recent
creation of an independent presidential palace guard, apparently more politicized and
probably better armed than the national police force. Several incidents of conflict
between the two groups have already been reported, and this development is another
ominous throwback to earlier Haitian history, including the tensions between the Haitian
army and the Macoutes during the Duvalier era.

In sum, the internal security situation is considerably more threatening with the
departure of the U.S. troops who had been the dominant factor for maintaining law and
order from the return of Aristide in October 1994 until now.

As for the deepening economic crisis, I wish to attach for the record my Op Ed
piece from the Journal of Commerce, January 16, 1996, "Haiti's Aid-Fueled Economy,"
which explains the circumstances of the "Haitian aid bubble economy" in 1995, and the
fact that the aid bubble is now rapidly deflating.

The international community, led by the Clinton Administration, was committed
to the successful conclusion of the Aristide presidency, and thus provided on
extraordinarily high and unprecedented level of aid disbursements to Haiti in 1995,
totaling $600 million, or 25-35 percent of Haitian gross domestic product (GDP). This
aid largesse produced a temporary boost for the economy that had been devastated by
the preceding economic embargo. The intent was for this aid to provide an emergency
bridge of economic support while the Haitian government implemented critical economic
reform measures to resuscitate the bankrupt Haitian private sector and thus create
sustainable, productive jobs. The Aristide government, upon return, committed itself to
such economic measures, including sharp cuts in the bloated government ministries, a
renewal of tax revenue collection which had dropped to a minimal three percent of GDP
during the embargo, and privatization of malfunctioning public sector enterprises -most
importantly, the economic infrastructure enterprises providing electric power, telephones,
and port facilities.

Unfortunately, the Aristide government's record was one of brave words but
almost total non-performance on economic reforms. As a result, the $600 million of aid
bubble support has been expended, largely for temporary public works projects and
budget support payments for the government, but with little effect on permanent job
creation or on investor confidence that remains virtually nil.

The economic outlook for the Preval government is thus exceedingly grave.
Unemployment in Port-au-Prince is 70-80 percent -creating a political tinderbox -while
the extraordinarily high aid disbursements of 1995 are in rapid decline. U.S. aid to Haiti
will drop from $235 million in fiscal year 1995 to $80-90 million in 1996 (which alone
equates to a drop of 7-10 percent in Haitian GDP), and other aid donors are insisting on

54

concrete implementation of economic reforms before continuing their disbursements.
Meanwhile, the large majority of impoverished Haitian people are legitimately asking
what happened to all of the much heralded aid flowing into the country. The unfortunate
answer is that most of it. because of non-performance by the Aristide government, has
been squandered on temporary relief with no lasting positive effect, particularly through
budget support to the public sector payroll.

This is the grim picture -in political, security, and economic terms -facing the new
Preval government. If the government is to survive, it must act quickly to implement
economic programs necessary to resuscitate the heretofore resilient Haitian private
sector, as well as to facilitate urgently needed foreign assistance, albeit at substantially
lower levels than in 1995. A positive change in the investment climate, moreover, will
also require major movement toward political reconciliation by the leftist Preval/Lavalas
government -a reaching out to technocratic and business participation -and reassurance
from the government that the police forces will be led and deployed in a non-political
way.

As for the United States, it is regrettable that once having restored Aristide to the
presidency and seen him through the election of his successor-the short term
objectives-U.S. support for Haiti is being cut back abruptly for what happens next in
even more precarious circumstances. U.S. economic aid is being cut by two-thirds, the
peacekeeping role is being handed over to a small Canadian-led force, and there is an
apparent political distancing from the Preval government.

The U.S. government, after having expended more than $2 billion on the
economic blockade and the military intervention, not to mention $235 million of
economic aid in 1995, has a self-interest in seeing that Haiti regains a reasonable level of
political stability and self-sustaining economic growth which will endure beyond 1996.
U.S. interests in Haiti are important, particularly with regard to protecting our borders
against illegal migration, drug-trafficking and other international crime.

The United States should thus continue to provide.strong economic support for
the next stages of economic recovery, although this time conditioned more firmly on
reform implementation by the Preval government and provided, for the most part,
through the private sector and private voluntary organizations. The police training
function should likewise be continued, conditioned in this case on the police functions
being maintained non-political. If the Haitian government fails to meet these minimum
standards, it has no one to blame but itself and there is little the United States can or
should do to sustain it. But at this critical juncture it remains in the U.S. interest to
continue its conditional strong support and hope for sharply improved performance by
the Haitian government.

55

Testimony of

Peter B. Johnson
Executive Director
Caribbean/Latin American Action

to the
Western Hemisphere Subcommittee
Committee on International Relations
U.S. House of Representatives

My name is Peter Johnson. I am Executive Director of
Caribbean/Latin American Action, a private, non-profit
organization dedicated to promoting economic development in the
Caribbean and Latin America,

The Committee has called these hearings to deepen
Congressional understanding of the what the imminent departure of
the U.S. military contingent will mean for Haiti and for U.S.
policy in that country. The real worry of this Committee, and
all concerned Americans, is the direction that Haiti is headed,
and whether the type of breakdown in security and democracy that
caused the U.S. military involvement in the first place is likely
to recur. It would be reassuring to report that the mission has
been accomplished, the crisis is past, and Haiti is rebuilding
its political institutions in a climate of security and economic
recovery. Unfortunately, that is not the case.

The Real Threat to Security is Economic Despair

The security question is uppermost in many minds as the U.S
military departs. Recent increases in crime and violence have
sparked added concern. I am not in a position to offer any
insight on what difference, if any, the replacement of U.S.
leadership and troops in the peacekeeping force with those of
other nations will make in Haiti's security. However, I can tell
you that whether the U.S. troops go or stay, whether their
replacements are effective or not, the main threat to Haiti's
security will remain. If this Committee believes an insecure,
undemocratic, chaotic or violent Haiti would pose a problem for
the United States--and these hearings clearly suggest you do--you
need to look at the circumstances most likely to make that
happen, which is not the withdrawal or recomposition of military
forces. Economic despair is the major threat to continued
stability and security in Haiti;

The violence that has been escalating in Haiti is not
political. We can be thankful that we do not seem to be facing
at this time the type of nightmare scenarios many most feared--
plots to unseat the government, mob violence, politically
motivated killings, armed factions, the kinds of things that
signal an approaching collapse of political institutions, even a
road toward civil or class war. The problem we face is no less
serious, just different. As the recent violence in the Port-au-

56

Prince slums of Cit6 Soleil and La Saline has shown, this is
ordinary street crime, the kind driven by acts of economic
desperation. We can expect to see more of it unless the economic
catastrophe in Haiti changes.

The Economic Situation is in Fact Desperate

Almost exactly a year ago, I testified before this Committee
on the bleak economic situation in Haiti and the desperate need
for jobs. Today, Haiti's staggering unemployment remains the
most critical issue facing the country. I would like to stress
that without significant adjustments to Haiti's economic
situation, the political and social advancements that have been
made in Haiti this past year with the assistance of the U.S.
military will be seriously jeopardized.

The situation since last year has not improved; it is worse
than ever. C/LAA has been deeply involved with the Haitian
economy since 1980. We have argued since that time that Haiti
needed to strengthen its business environment if its potential
for investment was to be reached, so the people could go to work,
and feed their families. Albeit under non-democratic leadership,
some improvements had been made and the economy showed results.
Unemployment in that period was high, with the best figures in
the 40% range. The embargo and unstable business environment
that attended the process of reinstating the legitimately elected
president dried up virtually all foreign investment, with the
result that Haiti today is in worse shape economically than it
has been in recent memory. The companies have not come back, the
jobs are not being created, the economic climate is not
improving. Today, unemployment and underemployment are in the
80% area. With no source of legal income, some of Haiti's poor
will seek survival by extra-legal means if necessary,
notwithstanding the presence of external force.

What needs to be done quickly are first steps toward
rebuilding Haiti's reputation as a place to invest, thereby
create the jobs that are essential for political stability.
Military force can never accomplish this, nor can the best
trained police force. It must come from Haitian policies that
gradually strengthen investors' confidence in a democratic Haiti.

Haitian Government is Doing Nothing

The current problem is not just the desperate economic
situation but the fact that the Government of Haiti is not doing
anything to reverse it. Instead, its policies are driving both
investment and assistance away while actually making things worse
for the individual Haitian. Though Haitian officials will tell
you they want to attract business and jobs, let us look at what
has actually happened:

* First, privatization isn't happening. The Government of
Haiti committed itself over a year ago to privatize nine major

57

state enterprises. Only two got to the stage where bids were
solicited, and in those, the process was suspended after bids
were received. As a result, Haiti lost both the jobs that would
have been created in revitalizing those industries themselves,
and the improvement in services--for instance, in electricity,
telephones and ports--that would have made it possible for more
businesses in other sectors to operate.

* Second, the government allowed its moratorium on high port
charges for exports to expire at the end of January, reinstating
the astronomical fees that a business survey we conducted last
year identified as a major impediment to business development in
Haiti.

* Third, uncontrolled spending by the Government of Haiti is
creating a huge deficit, stimulating inflation that will further
impoverish the already poor people of Haiti. In January of 1995,
over twenty international organizations and representatives of
fifteen governments met with Haitian officials in Paris to
discuss Haiti's economic and social reform program. Some $1.3
billion in aid was committed by the international donor
community, of which $600 million has been disbursed. Yet, even
with this tremendous economic and technical assistance, economic
indicators are dismal. The 1996 deficit is projected at $156
million. This cannot help but drive the value of the Gourd
down.

* Fourth, the government has failed to commit itself to a
structural adjustment program, thereby cutting off the assistance
from international agencies that had already been earmarked for
Haiti, and that it desperately needs. Though international
relief is not the permanent answer to unbalanced budgets, Haiti
could go a long way toward solving the immediate $156 million
deficit problem by moving forward on structural adjustment, which
will release about $125 million in frozen donor funds. The same
adjustments will give the country a chance for economic recovery
that will reduce the need for international bailouts in the
future.

* Finally, the Haiti Government has no plan or program in
place to create jobs in the private sector by boosting trade and
investment in the manufacturing, agricultural and service
sectors. None of the international aid that poured into the
country last year was channeled into rebuilding Haiti's private
sector. Instead of incentives, the potential investor, whether
foreign or domestic, has found insuperable impediments--high
costs, woefully inadequate infrastructure, flip-flopping on
privatization, the absence of economic policies, and the fears
for security and stability that such hesitant leadership and such
unpromising economic indicators inevitably bring.

58

The Ball is in Their Court

Ordinarily, when C/LAA has had the occasion to come before a
Congressional committee, we are here to suggest a course of
action for the U.S. Government. It is important to note,
however, that in this situation the ball is really in Haiti's
court. Whatever paths or potential policies Haiti's new
government chooses, you in the American public sector and those
of us in the private sector can only recommend from our
experience what might work to create a stable economy. We will
not be the final arbitrator in Port-au-Prince, nor will we have
to bear the burden of poor decisions.

That having been said, I do believe the Congress of the
United States can have an impact in doing whatever you can to
voice your concerns and try to persuade the Government of Haiti to
confront this economic crisis and take the kind of steps that are
urgently needed.

In that spirit, I would like to suggest the action I believe
would be most useful as a first step on the part of Haiti. That
is to proceed in good faith and as expeditiously as possible to
implement their commitment to privatization.

Privatization--A First Step

Haiti has proposed to privatize nine industries--the
electric company, the telephone company, a flour mill, a cement
mill, the ports, the airport, two banks, and an edible oil plant.
Bids were sought only for the flour and cement mills, neither of
which have operated at all since 1991, yet have people on their
payrolls, obviously resulting in a deficit. After receiving
bids, the government suspended the process, and has done nothing
to contact the bidding companies. Even less has happened in any
of the other industries.

That ordinary commercial enterprises like flour, cement or
cooking oil can more appropriately and efficiently run in the
private sector seems almost too obvious to discuss. In the case
of the more traditional public or quasi-public utilities--power,
telephones, ports and airports--there are strong economic reasons
for Haiti to proceed with divestment.

* Electricity. The state-run electric company is draining the
national treasury while failing to provide the minimal services
the economy needs. Its operating deficit costs the government of
Haiti between $20 -$40 million. Yet it provides electrical
service for as little as four to five hours per day and only
reaches an estimated 10% of the population. The IMF estimated
that in 1994 Electricit6 d'Haiti took in approximately $925,0000,
while spending over $1.5 million. Moreover, the Haitian
government does not have the estimated $250 million required to
meet the short-term demand for power, let alone improve service
and create a profitable operation.

59

* Telephones. The Haitian telephone company, TELECO--
virtually alone among the state enterprises--does make a profit,
and serves as an important source of revenue for the state. But
its inadequate infrastructure and service is holding back
business development in the country. Its completed call-ratio
both within Haiti and internationally is one of the worst in the
world. Like power, telephone service is a major factor that
investors look at when making decisions about placing their
money. The IFC estimates that the investment required to satisfy
short-term demand at TELECO would total $280 million--which,
again, the government does not have. One area that would provide
a temporary solution and immediate revenue is cellular service,
but here, too, the government dropped the ball. A number of U.S.
companies are interested in investing in this area. Yet, after
the Haitian government opened one of two state-owned cellular
licenses to bids, the process was suspended.

* The ports and airport are seen by the government as a
potential revenue source, though operating them is also a cost to
the government. Whether or not the high fees cover cost, the
ports are a drain on the nation's economy. They are widely
acknowledged to be the most costly and least efficient of any in
the hemisphere. Loss of much needed trade and investment is the
daily result.

Benefits of Privatization

Proceeding with privatization would give Haiti's economy an
immediate shot in the arm, along with much improved prospects for
long-term development. Here are some of the most important
benefits:

First, the multi-million dollar purchase prices to be paid
by the successful bidders to buy the enterprises will provide
much needed revenue.

Second, Haiti will save from not having the drain of running
major enterprises at a deficit. Ownership of a big money-loser
like the power company is an obvious budget drain, but even small
money losers like the non-operating flour and cement plants are
costing the government money it cannot afford to thrown away.

Third, progress on privatization would be an important step
toward structural adjustment, clearing the way for Haiti to
receive the $125 million from international agencies now
suspended for failure in the structural adjustment area.

Fourth, putting major service industries like power, ports
and telecommunications in private hands will bring badly needed
investments and improvements into those sectors, eliminating
major impediments in the areas of inadequate infrastructure,
limited reach of service, inefficient operations, high fees, and
frustrating red tape. These are sources of continuing nightmares
for individual citizens and businesses alike.

60

Fifth, these improvements in services will, in turn, do much
to make Haiti attractive again to manufacturing and agribusiness
investors, lowering costs and improving the operating climate.
This will have the major benefit of boosting employment in the
industries that were once the mainstay of Haiti's economic growth
and her ability to employ her people. This alone would make
privatization a high priority.

Sixth, reducing deficit spending by eliminating unprofitable
enterprises, boosting general business, and freeing international
aid will all help put a brake on inflation, the cruel tax that
takes away spending power from the little money the poor Haitian
has.

All these benefits should make rapid progress on
privatization an urgent priority for the Government of Haiti.
Right now it obviously is not. Perhaps you could add your voices
to those urging a change of heart. Politically, privatization
has never been popular, and persevering with it will require
courage in the short term. But everyone will see the gains in
the long-term, the masses of unemployed and underemployed most of
all. Virtually every developing country in the world today has
sought some form of privatization as a means of reducing
government expenditures and creating a more competitive
environment for business. Haiti needs, more urgently than many
others, to follow their example.

C/LAA's Plans .

C/LAA has a business delegation prepared to visit Haiti,
with the full support of the U.S. government, as soon as the new
Haitian cabinet is named. The objective of the mission of
international investors from various business sectors will be to
speak clearly about the needs of business, and what Haiti must do
if it wishes to improve its business climate. The amount of
available international investment is finite and usually avidly
sought. Haiti must take as its example the approaches of
Honduras, Costa Rica, or Barbados, to only name three. I could
also mention Spartanberg, N.C. These and other countries and
communities have built good reputations and are deriving the
benefits. Haiti will work if the new government acts decisively
and with purpose. And all of Haiti will benefit.

Thank you for giving me this opportunity to speak.

61

THE SECRETARY OF STATE
WASHINGTON

February 22, 1996

Dear Mr. Chairman:

With the inauguration of a newly-elected President and the
departure of American troops, Haiti enters a new era, and faces
a new set of challenges. I want to take this occasion to thank
you for your cooperation which, despite our differences over
some aspects of the policy, has allowed us to achieve our
shared objectives.

Because I value your cooperation, I am troubled that the
Western Hemisphere Subcommittee may believe that my Special
Coordinator on Haiti, Ambassador James Dobbins, did not keep it
fully informed on matters of interest to it. Ambassador
Dobbins has, as you may know, a particularly distinguished
record of service to five Administrations -- Democrat and
Republican. He played a significant role in the deployment of
medium range nuclear missiles to Europe, a major achievement of
the Reagan Administration. He advised Secretary Baker on the
unification of Germany and helped manage the peaceful breakup
of the Soviet empire. He served as President Bush's Ambassador
to the European Community.

This Administration turned to Ambassador Dobbins to
organize the diplomatic aspects of the withdrawal of our forces
from Somalia. We then asked him to marshall the efforts of all
our civilian agencies in support of an intervention in Haiti.
In these tough assignments, he has helped to save American
lives, advance American interests, and enhance interagency
coordination in support of our military's operations abroad.

I believe the record shows that Ambassador Dobbins'
statements at the October 12, 1995 hearing of the Western
Hemisphere Subcommittee were truthful. Ambassador Dobbins
recognizes now that more expansive answers would have been
appropriate and very much regrets, therefore, that he may not
have adequately addressed issues of interest to the
Subcommittee.

The Honorable
Dan Burton, Chairman,
Subcommittee on Western Hemisphere Affairs,
Committee on International Relations,
House of Representatives.

62

Any Administration needs career officers who will take on
demanding and sometimes highly controversial assignments, and
do them to the best of their ability. Even critics of our
intervention in Haiti have acknowledged the professionalism
with which Ambassador Dobbins has carried out his
responsibilities.

As Haiti enters the next phase in its development, I very
much hope we can work with you, Chairman Gilman, and other
Members of the Committee on International Relations to help set
that country on the right course. The challenges before Haiti
are great. If the Administration and the Congress together can
persuade the incoming Haitian Government to take the cu'Lrect
decisions on its security forces and on its economic policies,
we have an opportunity to reforge a consensus in this country
in support of our future role with respect to Haiti.

I have asked Assistant Secretary Sherman to advise me how
we can work more closely with you and the Committee on these
and the many other issues of common concern. I look forward to
working with you and the Committee in the months ahead.

I am writing with deep concern about your decision to
continue to provide assistance to the government of Haiti despite
the fact that the government of Haiti has not met the human
rights standard required by law. As you know, section 583(a) of
Public Law 104-107 prohibits assistance to the government of
Haiti unless you reported to Congress that "the Government is
conducting thorough investigations of extrajudicial and political
killings" and that "the Government is cooperating with U.S.
authorities in the investigations of political and extrajudicial
killings."

Mr. President, after spending billions of dollars and
deploying thousands of American troops to Haiti, Haiti has not
even conducted investigations into political murders and
government-affiliated death squads. Evidence available to you
from the Federal Bureau of Investigation, the Department of State
and other U.S. government agencies indicates that members of the
Haitian government -- both the previous Aristide government and
the current Preval government -- were involved in the planning,
execution and subsequent cover-up of murders of Haitian citizens.
And evidence available to you from the same sources indicates
that the government of Haiti is unwilling or unable to conduct
investigations of political murders or to cooperate with the
United States in such investigations.

Despite credible reports of Haitian government officials'
involvement in political and extrajudicial murders, and despite
the government's consistent unwillingness to investigate such
killings, you chose to exercise your waiver authority to continue
to provide assistance to the Government of Haiti. On your
behalf, Deputy Secretary of State Strobe Talbott signed a
document which asserted continued assistance to the Government of
Haiti was "necessary to assure the safe and timely withdrawal of
U.S forces from Haiti.".

64

In order for Congress to evaluate your decision to continue
assistance to a government which refuses to investigate political
killings, I would appreciate your answers to the following
questions. First, what threats to American forces have been
identified or received which led you to conclude that providing
additional assistance to Haiti was necessary for the safe
withdrawal of U.S. forces? Second, if the Haitian government
continues in its refusal to investigate political murders, do you
plan to continue any governmental assistance after U.S. forces
are withdrawn? Finally, will you speak out forthrightly and
unequivocally and condemn the refusal of the Haitian government
to investigate political murders?

Mr. President, the time for excuses is over. Haiti has been
occupied by U.S. military forces for fifteen months. The Haitian
armed forces have been disbanded. Haiti is not at war. Haiti
faces no real external or internal security threat. American
taxpayers have paid billions to support your policies toward
Haiti. Yet your Administration has been mute in condemning
Haitian government death squads.

After all that America has done for Haiti under your
policies, continued Haitian inaction on political killings is
unacceptable. It is time to assure the American people that not
one more American dollar will flow to a government which refuses
to investigate political murders by its own officials. The
American people deserve an unqualified statement that the Haitian
government's refusal to investigate government-affiliated death
squads will no longer be tolerated.

By ERNEST H PREEQ
ene Preval will be inaugurated
as the new president of Haiti on
Feb 7, succeeding Jean.Bertrand
Aristide amid concerns about re-
newed political violence The great-
er threat to stability in Haiti.
however. is a worsening economic
crisis that has been obscured by
what can best be described as an aid
bubble economy lThat bubble a now
debating at an alarming rate
Haiti has always been a very
poor country, but it was bolstered is
the IWBs by rapid growth of labor-
intensive, export-oriented industry
Halt oa the I million popIuloaton a
Port au Prince was supported, di-
rectly or indirectly, by such Indiw-
try The relentless raral/urban
migration was being absorbed, to
some extent at least, by a new job
creation cities and towns
This tenuous private seclor-dro-t
en development strategy was de-
stroyed in the early 1990s, rst by
political unrest leading to the mib-
tary overthrow of President Arnulde
in September 1991, and then by the
devastating three-year international
embargo led by the United States
Assembly mdustry closed down and
moved elsewhere Unemployment in
Port au-Prince rose to 70% to 80%
Government revenues collapsed
Irom an already low 8% of gron
domestic product to 3% Economic
intrastructure crumbled from se-
glect, and middle -class Haitians, -
sential for economic recovery.
moved to Miami
The September 1994 US military
interventn restored Mr Aristide o
power The need to revie Haiti's
economy was clearly recognized by
all Mr Aristlide announced a de-
tailed economic recovery program
designed to streamline the bloated
and corrupt public sector and renew
private sector tob creation The Ion-
ternuitonat comunnly responded by
pledging an extraordinarily large
emergency economic aid package of
$12 billion, of which halt was to be
disbursed in t99
But in the ensuing IS months, the
Ariside government tailed almost
completely to implement its eco-
nomi program, while the interna
tionat -ommunity is contrast, more
than lulftiled ins aid rotnotntment

Public payroll grew. rather than nation of 0.00D temporary public
declined, fiscal reforms were not be works jobs Aid financed imports -
ing implemented and privatization mostly of consumer products -
was put ott The private sector dis. have surged New imported cars
trusted and feared the lettoriented abound, and residential construction
government, and the climate for has revived after three years in the
new investment was extremely neg- doldrums
active Below the surface, however, the
The impact of the economic aid financial aid has had disturbing neg-
largesse on the Haitian economy is ative consetuences It provided tenm-
less clearly understood Disburse porary relief, but created no
ments of official aid through the end permanent )obs As disbursements
of 19S totaled about $600 million fall from the extraordinarily high
This was augmented through sub- IM5 levels, so does the Haitian econ
stantiat spending in the Haitius omy
economy by the US military and Ales. the aid-induced surge in tim-
UN peacekeeping forces Anotherporsa bu created an unholy alliance
revenue windfall to the Haitian gen- between the wealthy families that
ernment was a one-time payment by control the import and distribution
AT&T of three years of taxes on bus.nes an the corrupt Haitian cus-
telephone service held in escrow tons service Huge profits were
during the embargo made during IMS by well-placed I.-
The net aid amounted to 25% to porters, which explains much of the
35% percent of GDP In this context, residential building boom The Cus
the Clinton administration's an- toms service and other government
nouncement that the Haitian econo officials in on the take also had a
my grew 4% in 15. after a 35% banner year
decline during the embargo years. Moreover, the aid largesse was a
appears surprisingly meager, and in- primary reason why the Aristide
deed would be negative except for government did not implement its
the surge in aid funds economic program Direct aid pay-
The alid innow has benehited poe ments, which accounted for over
lions oa the Haitian population half of budget revenues, generated a
Much of it went for immediate alle- groundswell of public support for
aviation of poverty, including the cre- the Artside government, removing

Journal of Commerce
Jan. 16, 1996

any incentive to undertake unpopu
lar measures, such as fiscal reforniu
spending cuts. and privatization ol
public enterpriu-n
The new government will see the
aid bubble deflating rapidly U S aid
will drop from $23 million in fiscal
1995 to about $90 million in lisal
1996 This alone amounts to a drop
of 7% to 10% in Haitian GIDP
Other aid donors, primarily the
World Bank and the Inter American
Development Bank. protect little
short-term decline in aid commi-
ments, but the more critical level ol
disbursements will drop substantial
ly, as budget support payments are
replaced by slower disbursing prot
ect assistance President Arstide's
rejection of the ftralcial program
negotiated with the IMF and the
World Bank in October 1995 has put
all budget support aid on hold and it
will take at least several months for
the Preval economic leam to obtain
IMF approval lor a new program
As a consequence the Haitian
economy is headed downward from
its already depressed sate Inflation
has hit 30%. and is likely to acceler
ate through speculative consumer
purchases and a shat in bank ac
counts from gourdes to dollars
Electric power is down to 12
hours a day or less in Port au
Prince and telephone service is er
ratic The resilient private sector
has abandoned hope for attracting
foreign investors and export con-
tracts until a more promising bust-
ness climate emerges
Discontent among poor laitians
without Jobs could erupt in open io
lence ignited by armed opponents ol
President Preval The people rnghtly
ask where has all the foreign aid
gone The short answer is that it was
largely squandered on temporary
"ehie, particularly in the govern
meni pa) roll This ai the legacy al
the 1995 Haitian aid bubble econo
my
Ernest H Preeg to a yormir Anir
ican Ambassador t Haiti He i,
author of The Haitian Dilemma A
Case Study in Demographics. ie
velipient and IS FIoreign I'iil'y
(CSIS. January 1996)